ICE Canola Contracts Ease As Hedges Pick Up
| 1 min read
| By Dwayne Klassen, Resource News International |
| June 1, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mainly lower price levels at midday with some of the weakness a reflection of increased hedge selling and a drop off in demand, market watchers said.
Activity in canola was on the lighter side as market participants take to the sidelines to wait further news on the state of the crops across western Canada, brokers said. There were conflicting reports regarding canola planting delays and damage from recent heavy precipitation and snowfall, they said. A good portion of the volume total consisted of spreading as the large commodity index funds roll positions out of the nearby July future and into the November contract, traders said. The increase in hedge selling by elevator companies came as producers have more time to deliver canola into the cash pipeline, brokers said. The absence of fresh export demand was also an undermining price influence. The large world oilseed supply outlook also prompted some outright liquidation of canola futures, traders said. Some minor support came from scale down domestic crusher demand and the pricing of old export business to Japan by commercial accounts, brokers said. A small pull-back in the value of the Canadian dollar also provided some minor underlying support. There were an estimated 4,043 canola contracts traded at 10:26 CDT. There were no western barley futures traded as of 10:26 CDT |
