ICE weekly outlook: Loonie’s rally kept canola lower

MarketsFarm — Canola prices dropped over the last week due to a combination of factors, according to David Derwin of PI Financial in Winnipeg. The Canadian dollar was one of those factors, as it had a small rally that pushed the loonie to almost 72 U.S. cents. That rally ended Wednesday, however, when the dollar lost a penny in the morning. Support for the loonie came from gains in stock markets, Derwin said. Traders had been concerned of weakening futures, which saw a move to buy U.S dollars; however, that shifted the other way on Wednesday, he said. Soymeal and soyoil prices at the Chicago Board of Trade also factored into canola’s drop last week, according to Derwin. “Soymeal was weak and soyoil over the last couple for weeks has been basically sideways,” he said. Low crude oil prices also played into canola prices. The steep drop in crude, stemming from the Saudi Arabia/Russia price war and very weak demand for oil because of the COVID-19 pandemic, held down soyoil and corn. ...