ICE Canada Weekly Outlook: Awaiting harvest, USDA Supply/Demand Data

WINNIPEG--Canola contracts on the ICE Futures platform drifted lower during the week ended Sept. 8, although the market remains stuck in a sideways trading pattern as participants try to get a better handle on the size of this year's crop.

An upcoming supply/demand report from the U.S. Agriculture Department also has the potential to sway the market.

"We're just waiting to see how yields come out of the field ... and the USDA report on Friday," said Jamie Wilton of RJ O'Brien in Winnipeg.

The canola harvest is still in its early stages across most of the Prairies, with the summer drought leading to disappointing yields in many cases.

One southern Manitoba farmer noted that some fields in his area were only hitting bushels per acre in the single digits.

However, he added that fields that lucked out with timely rains were doing much better.

Statistics Canada pegged the crop at 14.7 million metric tons in a recent report. While that would be the smallest crop of the past decade, it still came in above trade expectations.

Meanwhile, in a report released Wednesday, the government agency pegged canola ending stocks in the country as of July 31 at 1.8 million metric tons. While that was roughly half of the previous year's carryout, it still came in well above market estimates.

While the eventual size of the Canadian canola crop will play a major role in the futures market going forward, much of the direction will also continue to stem from the larger U.S. soybean market. The September supply/demand estimates from the USDA could lead to nearby price swings if there are any surprises.

Source: Commodity News Service Canada, news@marketsfarm.com


  (END) Dow Jones Newswires
  09-08-21 1707ET
  Copyright (c) 2021 Dow Jones & Company, Inc.

News, commentary and research reports are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.