ICE Canada Review: Canola Weakens on Strong C$
| 1 min read
| By Dwayne Klassen, Commodity News Service Canada |
| April 6, 2011 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Wednesday’s session on the defensive with old crop canola values leading the downward price slide. Weakness in canola was associated with the upswing in the value of the Canadian dollar, which was believed to have scared off fresh export business as well as weakened domestic processor demand, market watchers said.
Adding to the bearish price atmosphere in the nearby May and July contracts was the belief that much of the remaining old crop export and domestic demand has now been covered by commercial accounts, traders said. The steady delivery of canola into commercial positions by farmers also contributed to the downward price slide experienced by the commodity, brokers said. Chart-based speculative liquidation was also an undermining price influence. The declines in canola were also encouraged by indications that some of the planting uncertainty this spring has now been factored into the market, brokers said. Some early selling of canola was stimulated by the losses seen overnight in European rapeseed futures. Declines in CBOT soyoil values contributed to the price weakness in canola with the late downturn in some CBOT soybean futures also encouraging some additional selling in canola, traders said. The advancing soybean harvest in Brazil and Argentina added to the bearish price tone. Activity in canola was described as light, as well as volatile. There were an estimated 12,513 canola contracts traded Wednesday, down from the 13,247 contracts that changed hands during the previous session. Of the contracts traded, 6,274 were spread related. Western barley futures were untraded and unchanged Wednesday.
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