ICE Canada Review: Demand Pick-Up Helps Canola
| 1 min read
| By Dwayne Klassen, Resource News International |
| March 22, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Monday’s session mainly higher with the nearby months finding support from a pick up in commercial demand and from the pull-back in the value of the Canadian dollar, market watchers said.
The buying back of previously sold positions by a variety of market participants contributed to the strength. Some of the commercial demand was said to be covering fresh domestic processor needs, given that the weaker Canadian dollar helped to improve crush margins, brokers said. The commercial interest was also said to be covering previously conducted export business with Japan and Mexico, analysts said. Strength in CBOT soybean and soyoil futures also spilled over to provide some underlying support for canola. The implementation of spring road restrictions was a supportive price influence, but it did little to stop the pricing of future deliveries to the cash pipeline, traders said. The upside in canola was also limited early by the declines seen in Malaysian palm oil futures and by sentiment that canola acreage in western Canada will be up significantly this spring in comparison to the previous year’s level. The ongoing harvest of a record sized soybean crop in Brazil and Argentina helped to undermine canola values. There were an estimated 10, 493 canola contracts traded Monday, up from 9,495 during the previous session. Of the contracts traded, 6,612 contracts were spread related. Western barley futures were little changed in non-existent activity. There were no barley contracts that changed hands during the session. On Friday, no barley contracts were traded. |
