WINNIPEG, Manitoba--Canola futures broke below major chart support levels in mid-April, with nearby price trends all turning lower as attention in the market turns to the upcoming crop.
July canola fell below its 20- and 100-day moving averages, settling right on its 50-day moving average of around C$623 per ton on April 17 after losing nearly C$30 per ton in the span of five days.
"The momentum indicators have all turned decidedly lower," said MarketsFarm analyst Mike Jubinville. Although he added that the futures may be getting into oversold territory by some metrics.
Jubinville said there was little supportive news in the markets to provide any upward momentum, noting that "if there's bearish news or no news, we go down."
While most of the Canadian Prairies are still dealing with some element of dryness, there has been welcome precipitation recently and Jubinville said there was no real production concerns ahead of spring seeding.
Meanwhile, the lack of export demand for old crop canola continues to overhang the market. Canada has exported 4.24 million tons of canola through 36 weeks of the 2023/24 marketing year, which compares with 6.25 million tons by the same time the previous year.
"It's crickets on the export front," said Jubinville. He expected it would be challenging to even hit six million tons during the marketing year at the current pace, let alone the seven million tons forecast by Agriculture and Agri-Food Canada.
Source: Commodity News Service Canada, news@marketsfarm.com
(END) Dow Jones Newswires
04-17-24 1644ET
