Canola futures get most of the attention, but the number that actually decides how badly a crush plant wants your seed is the crush spread — also called the crush margin.

When margins are wide, plants run flat out and compete hard for canola. When margins are thin or negative, plants pull back, and that shows up in your local cash bid before it ever shows up on the futures board.

This guide covers what the crush spread is, how it's calculated, what drives it, and how to read it as part of a selling plan. It builds on the basics in our Canola Prices in Canada: The Complete Producer's Guide.

A crush plant buys canola seed and sells two things out the other end: canola oil and canola meal. The crush spread is the gap between what those outputs are worth and what the seed costs to buy.

It's the same underlying idea as the "board crush" used in the U.S. soybean market, adapted to Canadian oilseeds. Canada doesn't have a separately traded, liquid canola oil and meal futures market the way Chicago has for soybeans, so the margin is built as an index rather than a direct spread trade.

It's worth being precise about the difference between crush spread and basis, since the two get confused. Basis is the gap between your local cash price and the futures price for the same tonne of canola — it's about where you sell, and our complete guide to understanding canola basis covers it in depth. The crush spread is the gap between what a plant's oil and meal are worth and what it paid for the seed — it's about why a plant buys the way it does. The two are related — a wide crush spread is one of the reasons basis can strengthen — but they aren't the same number, and they don't always move together.

ICE Futures Canada publishes the Canadian Canola Board Margin Index — a formula developed by members of the Canadian Oilseed Processors Association (COPA). The calculation works like this:

The index is a measure of the trend in core processing returns at approximate industry yields — it is not what any individual plant is actually earning. Real-world crush margins move around that benchmark based on a plant's own yield, the actual oil content of the seed coming in, and the specific cash pricing that plant is using for oil, meal, and seed rather than the futures-based proxy.

Grain companies, canola traders, and market analysts across the industry watch this index closely — not just the crush plants themselves — because it's one of the cleanest publicly available reads on processing demand for the whole canola complex.

Some hypothetical, round numbers make the mechanics easier to follow. Say the weighted CBOT value of the oil and meal from crushing one tonne of canola works out to $770/tonne, and ICE canola futures are trading at $650/tonne. The crush margin is $120/tonne — a healthy return for the plant, and a strong incentive to run at capacity and bid competitively for seed.

Now say soybean oil sells off sharply on weak biofuel demand, and the same oil-and-meal basket is only worth $690/tonne while canola futures stay at $650. The margin compresses to $40/tonne. Nothing about your local elevator or your seed has changed — but the plant's incentive to chase supply has dropped sharply, and that pressure shows up in the next bid you see.

These numbers are illustrative only, not a market call — but the direction of the logic holds in every real crush cycle: margin expands, plants compete for seed; margin compresses, they don't.

You don't crush canola — but the plants bidding on your seed do, and their decision to bid aggressively or hold back flows directly from their own margin.

This is the same basis mechanism covered from a different angle in Canola, Futures, Cash, Basis and Commitment of Traders. Watching the crush margin gives you an early read on which direction basis is likely headed, often before it shows up on the bid sheet at your local elevator or crush plant.

Biofuel mandates pull hard on the oil side of the crush. When renewable diesel demand is strong, canola oil value gets bid up relative to seed cost, which widens the margin and supports aggressive crusher buying even in a well-supplied seed market. We covered the scale of this shift in Canola Prices Benefit From Rising Global Biofuel Mandates.

Because the margin formula is built directly on CBOT soybean oil and meal, a rally or sell-off in the soy complex moves the crush margin even when canola futures haven't budged. Crude oil is the thread connecting all of it — weaker crude tends to soften biofuel economics across the entire vegetable oil complex. Our look at Oil, Soybean Oil and Canola Seed tracks that correlation directly.

Canada's crush capacity has expanded quickly. More plants competing for a finite supply of seed can keep margins compressed even in a genuinely strong demand environment, since crushers are bidding against each other as much as against export demand.

Several new or expanded crush plants have come online across the prairies in recent years, adding capacity faster than seed supply has grown in some crop years — one reason margins can stay compressed even as overall demand for canola rises.

The margin nets a CAD-priced input (canola futures) against USD-priced outputs (CBOT soybean oil and meal). A weaker loonie widens the margin in Canadian-dollar terms without any change in the underlying commodities; a stronger loonie compresses it. Our currency analysis tracks the CAD/USD moves that feed into this.

Crush plants also cycle through scheduled maintenance shutdowns and seasonal run-rate changes. A plant offline for turnaround work removes demand from the market temporarily, which can widen margins at the remaining plants with no change in the broader oil and meal picture. Watching for shutdown announcements alongside the margin index adds useful context to a bid that suddenly looks unusually strong or weak.

The crush margin isn't a standalone buy or sell signal — it's context that sharpens the signals you're already watching.

As with everything else in this report: watch the trend over weeks, not the daily wiggle. A single day's margin print tells you almost nothing on its own. Our guide to basis trading signals covers how to combine that trend with your basis history into an actual decision.

ICE publishes the Board Margin Index directly, and grain-industry wire services republish the daily close alongside canola futures settlements. Processor-yield data and industry margin commentary from sources like the Canola Council of Canada round out the picture for anyone who wants to go deeper than the index alone.

We flag crush margin shifts whenever they materially reshape the demand picture, alongside futures, basis, and COT positioning, on our Canola page.

The difference between what a crush plant's outputs — canola oil and canola meal — are worth and what the seed cost to buy. A wide spread means strong processing economics and competitive crusher bids.

ICE’s Canadian Canola Board Margin Index takes the weighted value of CBOT soybean oil and meal futures (roughly 40% oil, 60% meal, with meal adjusted by a 0.75 factor for protein density) and subtracts the ICE canola futures price, currency-adjusted using the Bank of Canada daily average exchange rate.

Crush plants set their bids based on their own processing economics. A wide margin supports competitive local basis; a squeezed margin usually shows up as weaker basis, even when futures haven't moved.

We flag crush margin shifts whenever they materially change the demand picture, alongside futures, basis, and COT positioning, on our Canola page.

Not automatically. A wide margin supports demand, but a strong Canadian dollar, added crush capacity competing for the same supply, or a plant running below capacity for other reasons can all blunt the basis effect. Treat the margin as one input into your basis read, not a guarantee.

The Klarenbach Grain Report provides objective, chart-based analysis of Canadian grain markets. This guide is educational and is not individualized trading or marketing advice.