ICE Canola Contracts Up On Potential Output Problems
| 1 min read
| By Dwayne Klassen, Resource News International |
| April 30, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mostly higher price levels at midday with strength associated with reports of problems with rapeseed production in China and the Ukraine, market watchers said.
Some of the commercial demand influencing the upward price action in canola was related to weather related issues downsizing China’s and the Ukraine’s rapeseed crops, brokers said. Participants were said to be splitting positions between Matif and ICE Canada canola futures. Additional strength in canola came from the absence of significant hedge offers, with producers still concentrating on spring fieldwork and planting operations, traders said. The buying back of previously sold positions by commodity fund accounts were helping to keep a firm floor under canola. A downswing in the value of the Canadian dollar was also a supportive price influence. Good domestic crusher demand for canola was also evident, which further bolstered values, brokers said. The upside in canola was limited by the arrival of much needed precipitation across the previously dry regions of western Canada. There were ideas that additional moisture will be needed, but the recent rainfall was seen getting recently planted crops off to a good start, brokers said. The sell-off seen in CBOT soyoil futures helped to limit the price advances seen in canola. Overhead technical resistance was also helping to limit the upside in canola, brokers said. Spreading was only a minor feature of the activity in canola. There were an estimated 2,802 canola contracts traded at 10:34 CDT. There were no western barley futures traded as of 10:34 CDT. |
