ICE Canada Review: Strong Cdn dlr erodes canola gains
| 2 min read
| By Dwayne Klassen, Resource News International |
| June 2, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Wednesday’s session mixed with the nearby contracts lower and the deferred with gains. Canola futures traded at mainly higher levels for a good portion of the day before running into some resistance near the close, market watchers said.
Oversold market conditions generated some of the upward price momentum while the sharp upswing in the value of the Canadian dollar limited the upward price action and took prices down near the close. Canola contracts found early support from the buying back of previously sold positions and from the oversold price conditions. Gains in CBOT soybeans and soyoil helped to influence the early price advances as did the ongoing concerns about the extremely wet conditions for the planting and development of the canola crop in western Canada, traders said. Steady domestic crusher demand and the pricing of old export business to Japan by commercials also provided a firm floor for canola to work with, brokers said. The upside in canola was limited by the strong Canadian dollar and by absence of fresh export demand. A pick up in elevator company hedge selling was an undermining price influence as was the weather outlooks calling for reduced amounts of precipitation in the forecast for the weekend across the Canadian prairies, brokers said. The erosion of the gains seen in CBOT soybeans and the downturn in CBOT soyoil at the close also helped to erase the advances seen in canola. The rolling of positions out of July and into November contracts by the index funds helped to augment the volume total. There were an estimated 22.014 canola contracts traded Wednesday, up from 17,856 during the previous session. Western barley futures were untraded and unchanged Wednesday. No barley contracts changed hands during the session. On Tuesday, no barley contracts were traded. |
