DTN Canola Six Factors

TREND: The trend for May canola is higher for now.

NONCOMMERCIAL OUTLOOK: Noncommercial traders were net-long 78,257 contracts of canola as of April 7, and were net-sellers of 7,988 contracts through the CFTC reporting period as traders secured profits on recent long positions.

COMMERCIAL OUTLOOK: Commercial traders held a net-short position of 76,921 contracts of canola as of April 7, and were net-buyers of 8,768 contracts through the CFTC reporting period. May canola is currently priced C$13.10 below the July futures contract, a carry structure which widened (more carry) through the week and to the highest degree of carry between the contracts through their trading lives.

SEASONAL INDEX: Canola prices tend to peak between December and February and bottom in July or August.

PRICE PROBABILITY: The price of front month (May) canola declined through the most recent week, closing at the 24th percentile, a relatively inexpensive price location for buyers within the five-year range. 

VOLATILITY: The three-month price volatility for front month (May) canola fell through the most recent week to 10% as prices traded to their lowest weekly close in six weeks.