ICE Canada Review: Weather Uncertainty Aids Canola
| 1 min read
| By Dwayne Klassen, Resource News International |
| June 28, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished steady to mostly higher after trading a good portion of the day at lower levels. The buying back of short-positions near the close managed to generate some support as did the expansion of the rally seen in CBOT soybean values, market watchers said.
Early declines in canola had been linked to the lack of aggressive buying interest and the uptrend in the value of the Canadian dollar. Sentiment that canola was in need of a downward price correction after recent sharp advances also had sparked some early selling interest, brokers said. Overhead technical resistance also added to the early bearish price atmosphere as did the declines experienced by CBOT soyoil values. A pick up in elevator company hedge selling, tied in part to a pick up in farmer deliveries, also undermined canola futures during the day. Some position evening ahead of the acreage and grain stocks reports from the USDA on Wednesday and the Canada Day holiday on Thursday was a feature of the activity. Additional support in canola came from light domestic processor demand and the pricing of old export business to Japan by commercials, brokers said. Ongoing uncertainty surrounding the extremely wet conditions across the Canadian prairies and the negative impact on canola’s yield potential also helped to generate a firm price floor, traders said. There were an estimated 9,737 canola contracts traded Monday, up from the 18,916 contracts that changed hands during the previous session. Of the contracts traded Monday, 5,336 were spread related. Western barley futures were unchanged. No contracts were traded on Monday. On Friday, no barley contracts changed hands. |
