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Combination of Factors Strengthening Canola Market

A combination of factors is driving Canola markets on an upward trend as prices reach levels not seen since June, according to the Northern Canola Growers Association.

There is a strong commercial demand for canola as the market enters its seasonal upswing. Crush rates in North America are higher than they were at the same time last year, while exports remain steady year on year indicating a total demand exceeding that of a year before.

Meanwhile, supply is relatively tight, as there are two million acres of canola remaining in fields to be harvested in the spring. This canola, however, is expected to be of lower quality with higher dockage, higher moisture content, and lower oil content, making it probably destined for the export market.

Lastly, the raised figures for the Renewable Fuels Program recently release by the Environmental Protection Agency (EPA) are expected to lift demand for both canola oil and soy oil for the production of biodiesel.

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