ICE Canada Weekly Outlook: Canola Prices Correct Themselves

WINNIPEG -- Since November canola hit a multi-year high of C$824.90 per tonne on July 24, the contract lost more than C$70 since when it hit a three-week low at C$754/tonne on July 31.

However, a pair of recent positive sessions have lifted the oilseed's outlook.

The contract closed at C$766/tonne on Aug. 5 despite a stronger Canadian dollar, sharply weaker crude oil prices and December soyoil losing nearly one United States cent per pound over the past two sessions.

David Derwin, an analyst from Ventum Financial in Winnipeg said seasonal weakness ahead of harvest operations was a factor but the market correcting itself was another.

"After a big move like that, canola should bounce around like that regardless of what crude oil, soyoil or soybeans do," Derwin said, adding that the space between C$750 to C$760 per tonne is acting as a support level.

He also said that while canola conditions vary across Western Canada, most of what he heard suggests an overall good to very good crop when harvest begins.

"But there's always some comments like (the canola) could use some moisture," Derwin said. "That's not unusual this time of year, but as some people tell me in those key canola growing areas, the nights are cool, so that certainly helps ... There's still that average to above-average yields (growers) are still expecting, but there's a little bit of weather and growing still to go."

Crush margins nearing C$300/tonne and more crush capacity available on the Prairies is supporting canola prices and demand despite the upcoming harvest, Derwin added. However, seasonal weakness can still pressure canola prices.

"Financial gravity kicks in and tends to pull this lower into September and October. That's the way one has to approach this market," said Derwin. "Can it move higher? Sure, it's always got that potential to bounce up a little bit. But some of the bigger factors underlying this are the crude oil aspect and Iran and Russia ... and weather concerns in Europe.

"The odds are more so that prices will drift lower over the next couple of months."

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

(END) Dow Jones Newswires

August 06, 2026 09:38 ET (13:38 GMT)