Canola traders returned from the Christmas holiday in a buying mood, with futures solidly higher on Tuesday.
Chicago soybeans provided spillover support to canola, with the US market up sharply amid the continued port strike in Argentina, which has slowed export movement of agricultural goods out of the country. Persistent dryness for the soybean crops in Argentina and Brazil added to the upside.
Tightening domestic supplies also continued to underpin canola, with Agriculture Canada this month forecasting 2020-21 ending stocks at just 1.2 million tonnes, down from the November estimate of 2.25 million and more than 61% below the previous year. If accurate, 2020-21 Canadian canola ending stocks would be the lowest since 588,000 tonnes in 2012-13 and represent a stocks-to-use ratio of just 6%.
January canola was up $8.60 at $623.80, March gained $8.90 to $617.40 and May was $5.40 higher at $603.90.
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