ICE Canada Review: Weather Concerns Prop Up Canola
| 2 min read
| By Dwayne Klassen, Resource News International |
| May 28, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Friday’s session with advances after trading on both sides of the plus/minus line during the day. Strength in canola came from weather concerns and the pull-back in the value of the Canadian dollar, market watchers said.
Position evening ahead of the three day holiday weekend in the US was also a feature of the activity. The US markets will be closed on Monday for Memorial Day. Canola contracts were undermined early in the day by the sell-off seen in CBOT soybean and soyoil values. Firmness in the Canadian dollar and the resulting drop off in demand also fueled some of the early selling interest, brokers said. Some of the selling seen in canola also was tied to the record acreage estimates in western Canada and the potential for extremely large world oilseed production. However, as the session progressed, canola values began to edge higher especially as the Canadian dollar started to weaken off, traders said. As the Canadian currency lost ground, buying from a variety of outlets resurfaced, helping to take some contracts up. Buyers included domestic crushers as well as commercials, who were covering old business to Japan. Concerns about the impact snow may have on newly emerged canola crops in southern Alberta helped to generate some of the price advances as did the rain related seeding delays in Saskatchewan, brokers said. The buying back of short positions was also evident during the day also helped to encourage some of the price gains seen in canola contracts. There were an estimated 15,357 canola contracts traded Friday, up from 10,364 during the previous session. Of the contracts traded, 12,964 were spread related. Western barley futures were untraded and unchanged Friday. No barley contracts changed hands during the session. On Thursday, 9 barley contracts were traded. |
