ICE Canola Contracts Up On Fresh Spec Buying
| 1 min read
| By Dwayne Klassen, Resource News International |
| October 14, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mainly higher levels at midday. Strength in canola was stimulated by fresh speculative demand spurred on by the advances seen in CBOT soybeans and soyoil, market watchers said.
Early support in canola came from the advances seen overnight in Malaysian palm oil and European rapeseed values. Aggressive domestic processor demand for canola also influenced the upward price action, brokers said. The potential for a smaller Canadian canola crop and the tighter than anticipated supply situation for US soybeans also was an underpinning price influence, traders said. Dry weather issues in the soybean growing areas of Argentina and Brazil was also factoring into the advances seen in canola, they said. Tempering the upward price momentum in canola were steady hedge selling by elevator companies, especially as producers remain active sellers of canola into the cash pipeline, brokers said. Favourable weather for the harvest of the canola crop in western Canada was helping to restrict the price gains in canola. Early firmness in the Canadian dollar had helped to undermine canola futures, but the currency has since given up some of its strength, easing the downward pull on the commodity, analysts said. A good portion of the volume seen in canola consisted of position rolling out of the November contract and into the January future, brokers said. There were an estimated 6,638 canola contracts traded at 10:39 CDT. Of the contracts traded, 3,200 were spread related. There were no western barley futures traded as of 10:39 CDT. |
