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Agriculture and Agri-Food Canada (AAFC) has significantly raised its forecast for canola ending stocks in the MY 2026/27 to 1.979 million tons, compared to 1.504 million tons in its August estimate. The projected stocks were revised upward by 475,000 tons, representing an increase of nearly 32%. Meanwhile, the estimate for the previous season's ending stocks was also adjusted upward by 175,000 tons to reach 1.9 million tons.
This upward revision by one of the world's leading canola exporters reinforces expectations of ample global supplies. Higher carryover stocks are likely to ease competition among international buyers and exert additional downward pressure on both spot prices and canola futures.
The anticipated increase in inventories is also filtering through to the canola oil market. As canola seed is the primary raw material for oil production, greater seed availability is expected to reduce feedstock costs for processors. This trend weakens price support for canola oil and establishes the conditions for further price declines in the near term.
Furthermore, ample canola stocks are expected to encourage higher crushing volumes, resulting in increased supplies of canola meal. Expectations of higher output for this key feed ingredient are already putting downward pressure on spot prices and related futures contracts.
Overall, the higher Canadian canola stocks forecast creates a bearish environment across three interconnected markets: canola seed, canola oil, and canola meal. Future price movements will remain dependent on actual crushing rates, the strength of export demand, and the pace of stock liquidation throughout the MY 2026/27.
Source: UkrAgroConsult