ICE Canola Drops As Hedges Hit
| 1 min read
| By Dwayne Klassen, Resource News International |
| February 11, 2010 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mainly lower price levels at midday with weakness linked to a pick up in elevator company hedge selling and the losses seen in CBOT soyoil, market watchers said. Activity was described as light and choppy.
"The pricing of storage tickets by producers has resulted in some elevator company hedging coming into canola," a trader said. "Without any real buying interest, it’s not taking much in the way of those hedges to weigh on prices." The downward price movement in CBOT soyoil was helping to contribute to the downside as was the backing away from the market by domestic processors, brokers said. Strength in the Canadian dollar Thursday was also viewed as an undermining price influence for canola. Some support early in the week had come from reports of fresh export demand for Canadian canola. However, with the completion of that business, values again began to descend downwards, traders said. Exporters Thursday confirmed that a couple of cargoes of Canadian canola were sold to China earlier this week for July delivery. Price details were not available. The large global oilseed supply situation along with large stocks of canola on farm in western Canada were also viewed as bearish for values, traders said. Some scale down commercial demand limited the price declines. There were an estimated 8,796 canola contracts traded at 11:17 CST. There was no western barley futures traded as of 11:17 CST. |
