By Dwayne Klassen, Commodity News Service Canada
Winnipeg – September 18/12 – CNS – Canola contracts on the ICE Futures Canada platform were trading at mostly higher price levels at 8:23 CDT, with continued concerns about yield loss and some bargain hunting generating the support, market watchers said.
Smaller than anticipated yields as the harvest of the canola crop in western Canada continues, helped to fuel some of the price gains, brokers said. Market participants had been anticipating canola crop output to be in the 15.4 million metric ton ranger and higher, with that size of crop needed to cover the export and domestic crush program which has been called aggressive. However, with production now looking as if it will come under 14.0 million tons, end-users were looking to cover commitments sooner, rather than later, analysts said.
A slow down in the level of movement of canola into the cash pipeline by farmers also helped to fuel some underlying support.
Traders also linked the ability of canola to move higher to the fact that the gains in the commodity have trailed that of CBOT soybeans.
The upside in canola was being capped by the continued downward price action seen in CBOT soybean and soyoil futures, brokers said. Losses overnight in European rapeseed futures also added to the bearish sentiment in the canola market.
A lot of the price action so far has consisted of spreading.
As of 8:23 CDT, about 3,141 canola contracts had traded.
Milling wheat, durum and barley contracts were unchanged and untraded.
Prices in Canadian dollars per metric ton at 8:23 CDT:
Futures Prices as of May 24, 2013
Prices are in Canadian dollars per metric ton