ICE Canada Review: Domestic Demand Lifts Canola
| 1 min read
| By Dwayne Klassen, Resource News International |
| October 22, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Friday’s session on a stronger footing with continued strong demand from the domestic processing sector and a drop off in farmer deliveries into the cash pipeline providing the upward price momentum, market watchers said.
The evening up of positions ahead of the weekend was a feature of the activity seen in canola. Domestic processors were said to be enjoying favourable crush margins and in turn have been aggressively pursing canola supplies from producers, brokers said. Harvest operations in western Canada were also beginning to wind down, which has in turn slowed the level of farmer movement of canola into the cash elevator system, traders said. Some support in canola overnight had come from the advances experienced in Malaysian palm oil and European rapeseed values. Early advances in CBOT soybean and soyoil futures had also encouraged some of the price gains seen in canola. The pricing of old export business to Japan by commercial accounts helped to underpin canola futures as did some light chart-based speculative buying, traders said The advances in canola were trimmed when CBOT soybean futures turned lower and the gains in soyoil were tempered. Profit-taking ahead of the weekend further restricted the price gains in canola as did sentiment that values were overbought and in need of a downward correction, brokers said. There were an estimated 13,776 canola contracts traded Friday, down from the 24,806 contracts that changed hands during the previous session. Western barley futures were unchanged and untraded Friday. On Thursday no western barley contracts were traded.
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