ICE Canada Review: Canola drops on profit-taking
| 1 min read
| By Dwayne Klassen, Resource News International |
| September 21, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Tuesday’s session on the defensive with an increase in the level of farmer deliveries into the cash pipeline and bouts of profit-taking by commodity fund accounts generating the downward price slide, market watchers said.
The increased deliveries were associated with cash bids at the country elevator system climbing to levels producers were willing to sell at, brokers said. Firmness in the cash bids were reflecting of steady demand from the domestic processing sector and the need to cover old export business. Sentiment that canola values had climbed too high too fast and were in need of a correction to the downside added to the bearish price atmosphere, brokers said. A downturn in CBOT soybean futures near the close combined with the price weakness displayed by CBOT soyoil helped to undermine canola values. Weather outlooks calling for a window of opportunity so that producers in western Canada can make some harvest progress later this week also was viewed as an undermining price influence, analysts said. A small pull-back in the value of the Canadian dollar helped to limit the price weakness in canola. Spreading was a feature of the activity in canola and helped to bolster the volume total. There were an estimated 15,240 canola contracts traded Tuesday, up from the 15,067 contracts that changed hands during the previous session. Of the contracts traded, 8,064 were spread related. Western barley futures were unchanged. There were no barley contracts traded on Tuesday. On Monday, no western barley contracts changed hands. |
