ICE Canola Contracts Climb on Weather Concerns
| 1 min read
| By Dwayne Klassen, Resource News International |
| June 3, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mainly higher price levels at midday with strength being tied to ongoing concerns about rain related seeding delays and crop damage due to excessive moisture, market watchers said.
Weather outlooks calling for additional amounts of precipitation across the canola growing area of western Canada beginning Thursday night and possibly lasting through the weekend helped to fuel the price advances, brokers said. Canola values also pushed higher reacting to the gains seen in CBOT soybean and soyoil futures, traders said. A pull-back in the value of the Canadian dollar was also seen as supportive for canola with steady domestic processor demand also contributing to the strength. The pricing of old export business to Japan by commercials added to the supportive price atmosphere. The buying back of previously sold positions was also evident and further underpinned canola futures, brokers said. The upside in canola was limited by the absence of fresh export business and by elevator company hedge selling, traders said. Grain companies were said to be offering premiums in certain locations across the Canadian prairies, which has enticed producers to deliver canola into the cash pipeline, brokers said. Expectations for a large global oilseed supply situation helped to limit the upside in canola. The rolling of positions out of the nearby July future into the November contract by index funds continued to be a feature of the activity. There were an estimated 3,096 canola contracts traded at 10:22 CDT. There were no western barley futures traded as of 10:22 CDT |
