While this week was short due to Canada Day on Tuesday and Independence Day on Friday in the U.S., an upward trend was observed in canola and wheat futures.
Commodities Futures Advisor with Ventum Financial in Winnipeg Adam Pukalo noted the November canola contract on the ICE Futures Exchange was not only up this week, but also in the last several months. He said this week the contract was up about $3.40 a ton on the week, $38 a ton since June 4, $99.70 a ton over the last three months, and $109.80 since December 31.
"So canola definitely kind of going off of some of the weather issues and and I would say when looking at as well to the soy markets, those have been supportive as well." Pukalo added.
The November contract closed Friday at $719.70, an increase of 20 cents.
Pukalo also noted clients of his were "still bullish on prices" and have been capitalizing on rallies in the price of canola.
"The weather is definitely a big factor," he said. "I think this is when we could start to see whether it's beneficial rains come through. We're starting to get a little bit late now for things to help out, but a lot of clients I've been talking to said crops are looking decent in their areas, so I've been mentioning to clients to maybe either look at starting to maybe price a little bit more or even potentially use put options or going short the futures to protect kind of the prices that we're at right now."
Wheat futures, especially the September Minneapolis Wheat contract, were stagnant at one point in the year but Pukalo says it turned around this week with an increase of 21 cents a bushel on the week but closed Thursday at $6.46, down a quarter-of-a-cent in day trading. Like canola prices, wheat prices were aided by the weather as well as more buying from traders, Pukalo said.
"Kind of looking again at all of the data, wheat was definitely heavily oversold there from a technical standpoint in the last month. I do think that we're now starting to see just a little bit more buying come from whether it's institutional traders or retail traders and that's where you've seen some of these kind of spikes up here, but overall there's a wheat crop I don't believe is in trouble. So that's when, again, maybe some of these rallies are pricing opportunities."
Pukalo said the weather and how crops are developing are the main things he will be watching in the weeks ahead.
He also encourages people to talk to an advisor about futures trading prior to making any decision.