ICE Canada Review: Spec Selling Keeps Canola Pointed Down

By Phil Franz-Warkentin, Commodity News Service Canada
Sept. 27, 2012
Winnipeg – ICE Futures Canada canola contracts  closed lower on Thursday, seeing follow-through selling on recent  declines as fund traders continued to bail out of long positions.
Bearish technical signals, as prices fell below some key chart  points on Wednesday, accounted for some of the speculative long  liquidation that weighed on values, according to participants. A lack  of any significant end user demand, aside from scale-down pricing of  old business, was also bearish for prices.
Renewed strength in the Canadian dollar, which moved up by about  half a cent relative to its US counterpart, weighed further on canola,  said traders.
In addition, ongoing concerns over yield losses in parts of  western Canada have largely been priced into the futures for the time  being. However, that production uncertainty did provide some  underlying support.
Oversold price sentiment, a lack of farmer selling, and gains  in CBOT soyoil also served to limit the losses in canola.
About 21,622 canola contracts were traded on Thursday, which  compares with Wednesday when 22,635 contracts changed hands.  Spreading accounted for about 10,154 of the contracts traded.
Milling wheat futures were untraded, but revised lower after the  close. Durum and barley futures were untraded and unchanged.
Settlement prices are in Canadian dollars per metric ton.Price      Change

Canola            Nov     591.90    dn 3.20

Jan     595.60    dn 2.90

Mar     595.60    dn 1.90

Milling Wheat     Oct     290.70    dn 4.80

Dec     295.90    dn 4.80

Durum             Oct     311.90    unch

Dec     316.40    unch

Barley            Oct     250.30    unch

Dec     255.30    unch

Commodity futures

Futures Prices as of May 17, 2013

Canola Price Change
November591.903.20
January595.602.90
March595.601.90
Milling Wheat Price Change
October290.704.80
December295.904.80
Durum Price Change
October311.90
December316.40
New Barley Price Change
October250.30
December255.30

Prices are in Canadian dollars per metric ton

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