By Dwayne Klassen, Commodity News Service Canada
Winnipeg – November 6/12 – CNS – Canola contracts on the ICE Futures Canada platform were trading at mainly higher levels in early Tuesday morning activity. Some of the upward price action was associated with sentiment that values were due for an upward correction after two consecutive days of fairly large declines, market watchers said.
Activity was described as light and volatile, especially with most of the attention of market participants on the US Presidential election. Post election results were seen by many has unlikely to be supportive for CBOT commodities regardless of the outcome.
Market participants were also preparing for Friday morning’s USDA supply/demand reports. Based on historic events over the past six years, this report is notorious for increasing the size of the US soybean crop.
The upturn in CBOT soybean and soyoil futures further encouraged the price advances seen in canola, traders said.
Some light commercial demand under the market was helping to keep a firm floor under canola. Some of the interest was said to be covering both old and new export business as well as covering the needs of domestic processors, brokers said.
Farmer selling of canola into the cash elevator also remains on the lighter side, which was helping to provide some minor support.
Generally tight canola stocks in western Canada also continue to be an underpinning price influence, brokers said.
The upside in canola was being capped by bouts of profit-taking. The liquidation of long positions by speculative accounts is also not believed to be done, especially with the weather conditions in the soybean growing areas of South America again seeing improvement.
Losses overnight in Malaysian palm oil and European rapeseed futures also were helping to restrict the upside in canola, brokers said.
As of 8:32 CST, about 1,731 canola contracts had traded.
Milling wheat, durum and barley contracts were unchanged and untraded.
Prices in Canadian dollars per metric ton at 8:32 CST:
Futures Prices as of May 21, 2013
Prices are in Canadian dollars per metric ton