ICE Canada Weekly: Sideways trading likely until Trump sworn in

Glacier Farm Media | MarketsFarm — As to where canola and other grains go in the coming months is somewhat uncertain, said analyst Wayne Palmer of Exceed Grain in Winnipeg. He pointed directly at the incoming Trump administration in the United States and the policies the president-elect has been touting.

“We saw Donald Trump get elected and the stock market went for a ride to the Moon. They thought commodities would be the same thing,” he stated, noting the latter has largely pulled back since Election Day while U.S. farmers were overwhelmingly in favour of Trump.

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“His campaigning of making America great again, the big thing is he vows to have these agricultural tariffs in place, possibly 60 per cent. China is not going to put up with that. They will reciprocate and buy a lot of their grain from South America,” Palmer explained, adding that Canada will very likely be caught up in a China/U.S. trade war.

Until Trump is sworn in on Jan. 20, Palmer said canola and other grains will very likely trade sideways, albeit in very large ranges.

“For the most part, the technical side is going to dictate this until he gets into power,” Palmer stated.

Should Trump enact the sharp tariffs he promised, Palmer said the North American grain market, which had a good year in 2024, will be faced with too much supply and too little demand.

“If Trump backs off of this and China starts to buy American and Canadian grain, the technical funds will want to be part of this as well,” he added, stressing such would be a “crapshoot.”

“This is a tricky market right now. I don’t think there’s any follow through on the upside and I don’t think there’s any follow through on the downside. It’s wait and see,” Palmer explained.