DTN Canola Analysis & Recommendations

DTN Canola Analysis & Recommendations

09/03/2025

There was a new recommendation on June 17, 2025, for the 2024-25 and 2025-26 seasons.

POSITIONS

(6/17/2025)

2025-26

Made a forward sale of 20% of 2025 canola production on June 17, 2025, with November canola trading near C$740.00. 80% of 2025 canola production remains unsold.

2024-25

Made a forward sale of 25% of 2024 canola production on June 17, 2025, for June delivery with July canola trading near C$745.00. 25% of 2024 canola production remains unsold.

(4/22/2025)

2024-25

Made a forward sale of 25% of 2024 canola production on April 22, 2025, when July canola was near C$673.00. 50% of 2024-25 canola production remains unsold.

(5/31/2024)

2024-25

Made a forward sale of 25% of 2024 canola production on May 31 when November canola was near C$678.00.

(1/26/2024)

2023-24

Sold 50% of production as a cash sale for May delivery.

(1/5/2024)

2023-24:

Sold 50% of production as a cash sale for May delivery.

2022-23

March 9, 2023: Sold 60% of production as a cash sale.

Dec. 19, 2022: Sold 40% of production as a cash sale.

CURRENT ASSESSMENT

The trend in November canola is revised to down. Following a very dry start to the growing season, conditions improved rapidly over July and August, with StatsCan forecasting 2025 production to be 19.9 million tonnes, up 3.6% from 2024. Still, the fundamental situation for canola will remain intriguing, especially if any resolution to the trade dispute with China is reached. Thus far, AAFC has had to ration demand for the 2025-26 canola balance sheet, indicating there will not be enough supply to satisfy all demand angles, with lower exports expected as a result. July canola is currently a neutral, Type 3 market.

DAILY NOTE

November canola futures closed down C$13.40 on Wednesday to C$616.90. Grain and oilseed markets ignored declining crop conditions Wednesday, focusing instead on concerns over the lack of sales to China as recent meetings between China, Russia and India appeared to be very anti-American. Given the number of Chinese soybean processors that traditionally import soybeans on their own, outside of government import channels, it appears to be a coordinated boycott of U.S. beans. In the long run, the result may simply be a realignment of global trade patterns with increased U.S. domestic crush, also leaving less to export — but traders tend to want concrete results and answers sooner rather than later. Friday morning’s holiday delayed export sales report may shed more light on recent strong demand from alternative destinations. In the meantime, a few showers crossing the eastern corn belt over the next 24 hours will take the focus away from the dryness in the area. Weakness in the crude oil market, thanks to rumors of potential increased OPEC+ production quotas for October, is of little help as well for soybean oil and canola values. The trend in November canola is sideways.

RECOMMENDATIONS*

(6/17/2025)

2024-25 and 2025-26:

We are recommending a sale of 25% of 2024-25 canola production for June delivery with July canola futures trading near C$745/mt. We are also recommending selling the first 20% of conservatively expected 2025 canola production with November canola futures trading near C$740/mt. We are recommending these sales, not because we have lost faith in the bullish fundamentals of strong demand amid tight supplies and concerns over new crop production, but as part of a disciplined marketing strategy that rewards market rallies with incremental sales. With July canola now over $180/mt above the March low and November canola now $160/mt above its March low, both canola and soybean oil are looking overbought and due for a correction, and the best hope for widespread rainfall this spring in extended forecasts — failing to do so would not be appropriate. With 25% of 2024-25 production remaining, we expect to look for a rally to $800/mt resistance to make the final sales recommendation for old crop — always on the lookout for a potential need to abandon the strategy.

(4/22/2025)

2024-25:

We are recommending a sale of 25% of 2024-25 canola production for April/May delivery with July canola currently trading above C$670/mt. We are recommending the sale, not because we have lost faith in the bullish fundamentals of strong demand amid tight supplies, but as part of a disciplined marketing strategy that rewards market rallies with incremental sales. With July canola now over $100/mt above the March low, basis levels improving by over $20/mt and some profit taking at February highs being seen recently — failing to do so would not be appropriate. With 50% of 2024-25 production remaining, we expect to look for a break above resistance to make additional sales this spring.

(5/31/2024)

2024-25:

Take advantage of the recent spring rally and make a forward sale of 25% of 2024 canola production at this time. November canola is trading near C$678.00.

(1/26/2024)

2023-24:

Oilseed and vegetable oil markets continue to break down with the March contract returning close to the January low as prospects of a large Brazil soybean crop weigh on prices. Sell 50% of 2023-24 canola for May delivery, focusing on crusher sales wherever possible. The May is close to $620/mt.

**

*DTN recommendations are general in nature and are not intended to be specific for any particular person or farming business. The buying and selling of futures or options involves substantial risk and is not suitable for everyone. DTN accepts no responsibility for actual trades made.