ICE Canada Review: Weather Worries Propel Canola Up
| 2 min read
| By Dwayne Klassen, Resource News International |
| June 14, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform finished Monday’s session with strong advances. Gains in canola were influenced by continued concerns over the wet conditions across the key growing regions of western Canada and outlooks calling for more precipitation, market watchers said.
The excess moisture was definitely prevalent in Saskatchewan and Manitoba with fields in a number of areas in each province requiring a number of days in order to dry out enough to allow heavy equipment to enter fields, brokers said. There were ideas that a significant portion of the intended area that had been expected to be seeded to canola in both provinces will not be completed. Concerns also were rising over the damage to already seeded crops from the continued wet soil moisture conditions. Drier conditions were seen in a number of canola growing locations during the weekend, but the outlooks calling for more precipitation, were seen keeping producers out of fields and causing further damage to the yield potential. The advances in the nearby canola contracts were also tied to the buying back of previously sold positions and to steady domestic crusher demand. A slow down in the level of canola being delivered into the cash pipeline also fueled some of the advances, brokers said. The gains in CBOT soybean and soyoil futures further lifted canola values. The upside was limited in part by firmness in the Canadian dollar and through the taking of profits by a variety of market players. The unloading of July canola contracts in favour of the November future was a feature of the activity and helped to augment the volume total in canola, traders said. There were an estimated 31,694 canola contracts traded Monday, up from the 25,587 contracts during the previous session. Western barley futures were unchanged and untraded Monday. On Friday, no barley contracts were traded. |
