The canola oil cash market has remained relatively quiet over the last few weeks, perhaps due to ongoing volatility in the soybean oil market. At 17 cents, Los Angeles canola oil basis has largely remained unmoved, but in tandem with the sell-off in bean oil prices, outright prices crossed below 69 cts/lb to 68.74 cts/lb today. 

Like most of the vegetable oils, canola oil prices have been on a wild ride this year, slipping to two-year lows in the spring before rebounding in June due to rising U.S. vegetable oil demand and delayed canola seed planting in Canada. By the end of June, LA canola oil basis had climbed more than five cents since April, to 21 cents. Coupled with sharply higher prices for soybean oil futures, LA canola oil prices jumped above 90 cents per pound at their peak.

The spread between refined soybean oil and canola oil narrowed sharply in the late fall of 2022 just before the U.S. EPA approved an eligibility pathway for…