By Dwayne Klassen, Commodity News Service Canada
Winnipeg – October 10/12 – CNS – Canola contracts on the ICE Futures Canada platform were trading at lower price levels at 10:46 CDT Wednesday morning. Declines in the outside oilseeds, including the CBOT, helped to fuel the downward price slide, market watchers said.
The liquidation of positions ahead of updated production estimates from the USDA on Thursday was also evident and helped to weigh on canola values.
Some of the early selling that surfaced in canola came from the record palm oil production in Malaysia during September. That sparked ideas that canola is overpriced and was in need of a downward correction, brokers said.
A drop off in demand from domestic processors, also added to the bearish sentiment in canola traders said. Deteriorating crush margins were linked to the reduced demand.
The general firmness of the Canadian dollar was also an undermining price influence.
Some underlying support in canola came from the pricing of old export business by commercial accounts. Farmer deliveries of canola into the cash pipeline in western Canada also remains slow, which in turn helped to restrict the price drop, traders said.
A portion of the activity in canola continued to consist of spreading, with participants rolling positions out of the November canola contract and into the January future.
As of 10:46 CDT, about 6,788 canola contracts had traded.
Milling wheat, durum and barley contracts were unchanged and untraded.
Prices in Canadian dollars per metric ton at 10:46 CDT:
Futures Prices as of May 17, 2013
Prices are in Canadian dollars per metric ton