CE Canada Grain/Oilseed Rev: Canola Up On Monday’s CBOT Gains
| 2 min read
| By Dwayne Klassen, Resource News International |
| October 13, 2009 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished the session with advances Tuesday with much of the upward price momentum linked to the gains posted by CBOT soybean and soyoil futures on Monday when the Canadian markets were closed for Thanksgiving.
Strength in the Canadian dollar limited the upside price potential as did the declines experienced by the CBOT Tuesday, market watchers said. Canola posted sharp advances early in the session with most of that strength associated with the rally seen in CBOT soybeans and soyoil Monday, traders said. Gains overnight in Malaysian palm oil helped to influence some of the upward price action in canola as did talk that the Chinese had returned from holidays and were seeking out additional purchases of Canadian canola. No new business, however, could be confirmed by exporters. Some early strength in canola had also been spurred on by higher calls for CBOT soybean futures with the start of the North American day session. However, when CBOT soybeans and soyoil both started the session with declines, the advances in canola were also tempered. Gains in canola were also linked to the buying back of previously sold positions by a variety of market players, brokers said. Slow farmer selling into the cash market and some pricing of old business to Japan and Mexico also offered canola a firm price floor to work with, traders said. The upside in canola was also limited by the appreciation of the Canadian dollar Tuesday. In late day activity, the Canadian unit was trading just below the 97 US cent level. The strength in canola was also tempered by technical resistance levels and the prospects for a larger than anticipated canola harvest in western Canada, brokers said. There were an estimated 14,308 canola contracts traded during Tuesday’s trade, down from 13,379 during the previous session. Of the contracts traded Tuesday, 8,236 were spread related. Western barley futures were steady to slightly weaker with activity in the November and January contracts dominated mainly by commercials. Weakness was spurred on by the declines seen in CBOT corn futures Tuesday and the absence of fresh end-user demand, brokers said. An estimated 119 barley contracts changed hands during the session. On Friday, 31 barley contracts were traded. Of the contracts traded Tuesday, 44 were spread related. |
