Bearish factors for U.S. soy trump supports for canola

May 18, 2017

ICE Futures Canada canola contracts ran into upside resistance during the week ended May 12, as the commodity’s own supportive fundamentals were countered by the much more bearish outlook for U.S. soybeans.

Canadian canola supplies are looking rather tight, with Statistics Canada showing only 6.6 million tonnes in the country as of March 31. That’s about two million tonnes lower than at the same time the previous year, which means exports and the domestic crush will need to slow down or supplies will run out.

Both exports and the domestic crush are running well ahead of the year-ago pace, with exports of 8.6 million tonnes and a crush of 7.2 million tonnes (as of May 7, according to the Canadian Grain Commission), each about 800,000 tonnes ahead of what had moved through the system at the same point in 2016.

ationing that demand could lead to price spikes over the next few months if any buyers get caught short. On top of that, concerns over last year’s unharvested fields and this year’s seeding delays add another layer of support.

Estimates vary, but a significant number of acres in Western Canada still must be cleaned up from 2016. In some cases no crop will be salvaged, and the clock is running out for getting fields in a state to seed something new for 2017.

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Video: Dicamba Returns for Georgia Farmers: What the New EPA Ruling Means for Cotton Growers

After being unavailable in 2024 due to registration issues, dicamba products are returning for Georgia farmers this growing season — but under strict new conditions.

In this report from Tifton, Extension Weed Specialist Stanley Culpepper explains the updated EPA ruling, including new application limits, mandatory training requirements, and the need for a restricted use pesticide license. Among the key changes: a cap of two ½-pound applications per year and the required use of an approved volatility reduction agent with every application.

For Georgia cotton producers, the ruling is significant. According to Taylor Sills with the Georgia Cotton Commission, the vast majority of cotton planted in the state carries the dicamba-tolerant trait — meaning farmers had been paying for technology they couldn’t use.

While environmental groups have expressed concerns over spray drift, Georgia growers have reduced off-target pesticide movement by more than 91% over the past decade. Still, this two-year registration period will come with increased scrutiny, making stewardship and compliance more important than ever.