The lower Canadian dollar continues to provide support to canola values in the face of large global oilseed supplies.
“If you didn’t have this weakness in the value of the Canadian dollar, the price of canola would probably be $30 cheaper,” says Wayne Palmer, senior market coach with Agri-Trend Marketing and former floor trader in Winnipeg, in the interview below.
While large soybean stocks and production projections continue to limit upside potential, he says he expects the typical weather-related rally during the early part of the growing season, with new crop pricing opportunities in the $10.50/bu range.
“I believe you will see $10.50 a bushel. $11 will only be achieved if soybeans rally and stay closer to $10.50 a bushel,” notes Palmer.
As for acres, there’s a wide spread in projections for canola, but he says he doesn’t agree with analysts forecasting a drop in acres: “I believe you have to have more canola acres planted because you have more crush capacity and at these kinds of prices you’re going to have Pakistan, Japan and China lining up for new crop canola.”
Statistics Canada will release its acreage estimates on April 23rd.