Record canola and (nearly record) soybean crush margins

[TechAnalyst]

Canada Markets

Canola Crush Margin Sets Record Amid Soybean Oil Rallies


4/14/2026 | 10:15 AM CDT

By Mitch Miller, DTN Contributing Canadian Grains Analyst

Everyone needs to share in the profits to some extent, or everyone begins to suffer as weak links in the industry and lose confidence and inspiration. That concept may be lost on canola traders and the crushing industry currently given the record margins being set last week. Meaning canola producers are not being awarded their share of the (profit) pie, which improvements in biofuel demand and surging energy markets are inspiring. Something that would be helpful in retaining acres amid soaring fertilizer and fuel costs.

To step back for a moment, these are not absolute profitability measures. The Intercontinental Exchange (or ICE) publishes a gross canola crush margin based on the value of soybean oil and soybean meal futures (in their respective proportions) converted to Canadian dollars, less the value of canola seed futures. With fixed and variable expenses only increasing over time, it makes sense that the gross margin would need to continually improve for the crush industry to remain healthy; but this may be a bit extreme.

According to ICE data, April 6 canola crush margins hit a record high over $350/metric ton (mt) compared to under $60/mt at the end of last May. That exceeded the previous record of just over $300/mt set during the price spike that accompanied the Russian invasion of Ukraine. Prior to Covid (or 2021), canola crush margins spent most of the time in a range from $50 to $125/mt.

The most concerning part is that as recently as the end of January, the crush margin had finished a five-month consolidation period around the $200/mt range, still exceptionally profitable for the canola crushing industry. Which helped inspire record domestic use of 8.338 million metric tons (mmt) as of April 6, compared to 7.908 mmt last year (according to the CGC's grain statistics weekly report). But I'm sure producers wouldn't mind having some of the extra $150/mt or $3.40/bushel margin improvement seen since January passed on to them. Especially considering the extra costs they are about to incur thanks to the same war-inspired price spikes.

This is where everyone needs to take it more seriously. Canola traders and the crush industry must realize if canola producers are not allowed to share in the additional profits record-biofuel use will inspire, especially with soaring fuel and fertilizer expenses, they may well look for alternative, cheaper crops to grow, and less-risky cropping alternatives. Reduced production is the last thing the canola crush industry (or exporters for that matter) want right now.

Producers, on the other hand, should be very aware of the crush margin levels when setting up marketing strategies for the year to come. With it looking like strong soybean oil values are likely to remain, above-average crush margins should remain as well. As a side note, USDA increased its estimate of the annual soybean oil cash price from 55 cents/pound to 59 cents in one adjustment (in last Tuesday's WASDE update). Quite an unusually aggressive move by such a conservative entity.

And it's not just canola. Soybean crush margins are close to setting records themselves -- topping $3/bushel compared to less than $1.30/bushel just this past October and the previous spike record high of $3.10/bushel set very briefly in the fall of 2022. The normal soybean crush margin range prior to Covid was $.60 to $1.80/bushel with $.80 to $2.20/bushel more common over the past five years.

In the case of soybeans, the crush industry may not feel the need to improve the profitability for farmers given the corn situation makes soybeans look good enough as it is. With soaring costs of fertilizer and fuel, along with potential shortages of the former, acres may be switched from corn to soybeans without any further price incentive. That said, in the long run, producers should be aware of the fact crushers can certainly afford to improve their bids should they choose to.

I welcome feedback along with any suggestions for future blogs. My daily comments can be found in Plains, Prairies Opening Comments and Plains, Prairies Quick Takes on DTN products.

Mitch Miller can be reached at [email]mitchmiller.dtn@gmail.com[/email]

Follow him on social platform X @mgreymiller

(c) Copyright 2026 DTN, LLC. All rights reserved.

For the chart below...

ICE calculated canola crush margins set a record high last week at just over $350/mt compared to the previous record of just over $300/mt set during the Russian invasion of Ukraine. More strikingly, just last May they were under $60/mt, which prior to Covid, was right in the normal $50 to $125/mt range of crush margins. (DTN ProphetX chart)

[agstar77]

You mean the free market is rigged? What a shock. American and Canadian farmers pushed to bankruptcy but the crushers profiting?

[jdepape]

Where does Mitch say anything is rigged? Are you saying that a buyer - any buyer, including a crusher - should pay more simply because someone says they are making too much? Are you, as a farmer, willing to take less when buyers are in a pinch and their margins are razor thin, just because it would be a nice thing to do?

I've been around a while, so I can tell the story of canola in 1984 from personal memory. The industry oversold the crop (mainly exports) that year - there was basically nothing left. I think the official carry out that year was 170,000 tonnes. I worked for Cargill in Vancouver at the time and we were short to Japan and couldn't get enough canola, even though we were paying up - basis was a huge premium over futures, futures spreads - like the June/Nov - were inverted by over $100. Futures prices back then were usually around $280 - $350; the June 84 contract went above $700. To get enough canola to fill a rail car, we had trucks going from elevator to elevator picking up less than carload amounts to clean out the elevator and hauling it all to one elevator to load a few cars - an added expense we weren't counting on. We had to cancel or defer contracts to Japan. Also very expensive. And we weren't the only ones; every exporter was in the same boat. And the few crushers around back then had negative margins.

The memory of this is what keeps me pushing for export sales reporting like they have in the US. But no one ever suggested to manage prices to make sure margins are "shared equitably".

And then you may remember there was a crushing plant in Sexsmith Alberta years ago. It couldn't make a go of it and is long gone. I suppose if the local farmers were willing to take lower prices back then, it may still be there.

Mitch is right - the crushers are in a position to potentially create a market that supports the acreage base needed to satisfy the apparent demand. But when they are getting more canola than they need at prices like $15 to $16/bu or more, what would you have them do? Offer to pay $17 but then say, but we can't take it? There's a lot wrong with how price is determined, published, distributed, packaged and so on, but if we are going to get anywhere, farmers need to realize that they are often their own worst enemy when it comes to marketing / sales behaviour.

Since Its Agstar77 that this is really addressed to, let me put it in CWB terms. The CWB held this notion that the grain market was a pie of limited size - if railroads or grain companies were making more - in the CWB's mind, getting a bigger piece of the pie, it was at the expense of the farmer. They maintained policies that reigned in both railroads and grain companies - for control, yes, but also to make sure that they weren't making any money that the CWB thought should go to the farmer. You know, share the available margins so everyone keeps their piece of the pie. They couldn't see that a better approach could be to grow the pie - make it expand. Taking steps to make sure the farmer kept his piece of the pie, ended up making the pie actually get smaller (with the CWB in place, wheat acres dropped, and Canadian global wheat market share dropped). This is why I call the CWB and its proponents, The Brotherhood of the Shrinking Pie.

The thing I take away from this crush margin situation is this: if crushers had to pay more for canola, they could - and would. But they don't have to, because farmers keep selling.

[fjlip]

Always been like this, Farmers keep prices down all by ourselves...the need for CASH!
Every sale keeps reducing prices...

[agstar77]

So JP are you saying farmers are poor businessmen or stupid?

[SASKFARMER]

The new plant at Regina isn't even in the game most days. Yorkton was better but as the price went back up they all decided to squeeze real tight farmers. Where not winning just enough rope to keep spending.

[jdepape]

So JP are you saying farmers are poor businessmen or stupid?

JP?!
So the farmers I know might set a target at $15 - or $16/bu, get filled and lock in a decent return. Others are starting to use the same tools and techniques that the buyers use - like basis and spreads. How can that be construed as poor business or stupid? Having said that, surveys and studies show that marketing, understanding markets and how they work is consistently a top concern of farmers. Is it stupid to understand what you need to know?

But let me add more context to what I'm saying. Canola buyers are basis and spread traders. Farmers tend to be flat price sellers. And using target price contracts, or grain pricing orders, gives them even more power. You're playing with different rules, and the way its playing, they have the benefit. The farmers I know are doing what they can to rebalance and re-level the playing field by how they market their grain.

That's pretty smart if you ask me.

[AlbertaFarmer5]

You mean the free market is rigged? What a shock. American and Canadian farmers pushed to bankruptcy but the crushers profiting?

By this logic, back in 2022 when Farmers profit margins were at record high, what market interventions would you have proposed to ensure that the prices we received were fair to the crushers and other end users?

We were clearly gouging the consumers.

[blackpowder]

You are never going to get through to the Brotherhood.

I likely will not live long enough to see weekly export sales reporting. A majority of farmers modernizing the way inventory is sold will be a generation past that.
Hell, most still think forward sales of wheat and canola carries a risk.

[makar]

Hell, most still think forward sales of wheat and canola carries a risk.

I dont understand this statement could you please explain it to me not being sarcastic.