Canola futures ended higher on Thursday, supported in part by a sharp rebound in energy prices.
Crude oil and gasoline settled sharply higher amid uncertainty surrounding a proposed plan by Iran and Oman to reopen the Strait of Hormuz. Concerns that the key shipping route could remain restricted added a risk premium to energy markets, improving the relative appeal of vegetable oils used in biofuel production and providing spillover support for canola.
Production uncertainty continued to help underpin the canola market. Alternating periods of rain and sunshine are expected during the coming week, but dryness is forecast to expand and intensify from southern Alberta into much of Saskatchewan and Manitoba, according to World Weather Inc. Crop conditions remain generally favourable, although timely rainfall will become increasingly important later in August, particularly across southern areas that are expected to continue drying through Aug. 14-20.
Today's Saskatchewan crop report showed the harvest in that province at 2% complete as of Monday, with producers starting on winter crops and early seeded spring cereals.
November canola was up $2.90 at $768.90, and January added $3.30 to $779.
