b'VIEWPOINTSA Canola Pricing StrategyNeil Blue takes a look at the canola futures market in a strong carrying charge situation. CANADIAN CANOLA STOCKS at the 2018-19 crop year-endASG: Can you explain a carrying charge market?are estimated near four million tonnes, a new record, accordingNB: Carrying charges include:to Statistics Canada. The carryover at the end of this crop year iscommercial storage ratesas in a commercial buyers yet to be determined, but it may not increase as much as somefacilityhave suggested, says Neil Blue, provincial crop market analyst interesttypically bank prime interest ratewith Alberta Agriculture and Forestry. He says the unfinished insurance costs for that cropa minor costcanola harvest and unknown timing of a potential resolution ofA carrying charge market is one where the higher prices into the canola trade restrictions imposed by China leaves the 2019- the future pays all or a large portion of the costs of storing a 20 canola carryover uncertain. Alberta Seed Guide discusses thecrop from one period to the next. canola market with the crop market analyst.ASG: What are the current carrying charges in the ASG: What is the current canola market situation? canola futures market?NEIL BLUE (NB) : Cash canola prices are about five per centNB: Here are the closing canola futures prices and spreads for lower than a year ago. The basis levels, or difference betweenNovember 12, 2019, in dollars per tonne.the cash and futures price, is mediocre, which implies plenty of supply relative to demand. That is not an unusual situationJanuary 462.10for the harvest period. Because of a rise in world vegetableMarch 471.60 $9.50 above Januaryoil prices relative to canola prices, crush margins have strengthened, and that is supporting crusher demand.May480.40 $8.80 above MarchJuly 487.90 $7.50 above MayASG: What is the canola futures market looking like?NB: The canola futures market is in a strong carrying chargeThe higher successive canola futures prices are not a forecast situation, which is a reflection of the large canola inventoryfor higher prices in the future. They reflect the current carrying and currently restricted demand. That is, the futures market ischarge the market builds in for storage, interest and insurance. significantly higher in successive futures months within this crop year.58seed.ab.ca'