WINNIPEG--With good gains from other edible oils, canola has remained on the increase so far during the week of Oct. 18. It is uncertain as to how much longer the rally could press on, but an analyst said canola punching through C$1,000 per metric ton again is possible.
"Never say never, it's gotten there before," said analyst David Derwin of PI Financial in Winnipeg.
Over the course of the last week, November canola has jumped C$46.10 to C$949.30 per ton on Wednesday. Over the same time, Chicago soyoil for December has climbed 5.11 U.S. cents to hit 64.70 cents per pound.
Canola caught a good amount of spillover from the soy complex on the Chicago Board of Trade, particularly soyoil. More support has been coming from significant increases in European rapeseed and Malaysian palm oil, both of which have hit new contract highs recently.
"Technically on the charts, the buying activity and the trading activity are saying [canola] is going higher," Mr. Derwin said.
Besides comparable oils, the Canadian oilseed has also been getting support from its tight supply situation and a marked downturn in production on the Prairies this year. Mr. Derwin noted that buyers are grabbing whatever canola they can.
Despite the Canadian dollar busting through 80 U.S. cents and still climbing, the analyst said the loonie hasn't been too much of a factor when it comes to canola prices. He pointed to wheat and oat prices having more influence than the dollar.
Still, a higher loonie means more expensive canola on the export market. Price rationing has curtailed exports to a great degree so far in the 2021-22 marketing year.
Source: Commodity News Service Canada, news@marketsfarm.com
(END) Dow Jones Newswires
10-20-21 1709ET
