ICE Canada Weekly Outlook: July-Nov Spread Signals Large Carryover

ICE Canada Weekly Outlook: July-Nov Spread Signals Large Carryover

The July-November spread in the canola market points to a large carryover for the 2025-26 season. Tony Tryhuk, director of futures trading at RBC Dominion Securities, noted that the spread flipped from C$20 over in March to C$11.50 under, indicating significant bearishness.

Why the Spread Matters

Tryhuk emphasized that the July-November spread is a key indicator of ending stock concerns. The C$31 swing suggests a large carryout for 2025-26. In March, the spread was C$20 over, but now it's C$11.50 under, showing no signs of easing.

Export and Stock Data

As of May 17, canola exports reached 6.94 million tons, down from 8.19 million a year earlier, according to the Canadian Grain Commission. Agriculture and Agri-Food Canada projects 2025-26 canola ending stocks at 2.72 million tons (up from 1.6 million in 2024-25). The carryover for 2026-27 is expected to pull back to 1.32 million tons.

Planting Pace and Weather

Spring planting across the Canadian Prairies will speed up with above-normal temperatures. Manitoba is 55% complete, Saskatchewan 29%, and Alberta 53%. Tryhuk sees resistance in the November canola contract at C$770 per ton, with only threatening weather able to push prices higher.