ICE Canada Review: Old Crop Canola Down on Strong C$
| 2 min read
| By Dwayne Klassen, Resource News International |
| April 5, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Monday’s session mainly higher with only the two nearby months finishing with declines. Weakness in old crop contracts was spurred on by the strength in the Canadian dollar while dryness concerns in parts of Alberta and Saskatchewan gave new crop months a firm floor to work with, market watchers said.
Activity in canola was on the lighter side with many market participants extending the Easter Holiday weekend. Canola contracts generally traded at lower levels for the bulk of the day as the strong Canadian dollar discouraged fresh export business and caused domestic crushers to back away from the market due to the pull-back in profit margins, traders said. The bearish price atmosphere in canola also reflected the price declines seen in CBOT soybean futures and losses overnight in Malaysian palm oil, brokers said. The already large global oilseed supply situation helped to undermine canola futures. Steady elevator company hedge selling also helped to weigh on canola prices. Concerns about dry growing conditions in a number of regions in Alberta and Saskatchewan heading into spring seeding helped to lift some of the deferred contracts. Traders noted that there wasn’t much of a spring run off in the province of Alberta due to the absence of significant snowfall in the mountains this winter. Underlying support in canola also came from the advances experienced by CBOT soyoil futures and by scale-down commercial pricing of export business to Japan. Spread activity helped to augment the volume total in canola. There were an estimated 13,285 canola contracts traded Monday, down from 14,675 during the previous session. Of the contracts traded, 10,844 contracts were spread related. Western barley futures were unchanged and untraded in non-existent activity. No barley contracts changed hands during the session. On Thursday, no barley contracts were traded. |
