ICE Canola Contracts Firm On Weak Cdn Dollar
| 1 min read
| By Dwayne Klassen, Resource News International |
| May 25, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mainly higher price levels at midday with strength tied to the downswing in the value of the Canadian dollar, market watchers said.
The decline in the value of the Canadian dollar was said to have stimulated fresh demand from domestic processors as well as from the export sector. Much of the exporter interest in canola was said to be pricing old business to Japan, traders said. Some additional support in canola came from the buying back of previously sold positions. Heavy rains in some parts of western Canada over the long-weekend were also seen as slightly supportive, as the moisture may cause some seeding delays, traders said. Canola had weakened in overnight activity in reaction to the uncertainty surrounding the euro-zone debt crisis and the sharp sell-off seen in Malaysian palm oil futures, traders said. The advances in canola were also being restricted by the weakness seen in CBOT soybean and soyoil values. Scale-up hedge selling by elevator companies also was limiting the upside in canola, brokers said. A good portion of the volume total in canola consisted of spreading, with market participants rolling out of the nearby July contract and into the November future, brokers said. There were an estimated 6,295 canola contracts traded at 10:24 CDT. Of the contracts traded, 4,828 were spread related. There were no western barley futures traded as of 10:24 CDT.
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