ICE Canola Drops On Fund Liquidation

A number of funds remain long canola, and with the charts now turning bearish, there is a push to unload the contracts, a broker said. The losses in canola were being amplified by the lack of willing buyers.

Contributing to the weakness in canola were the declines in CBOT soybean and soyoil futures as well as the absence of fresh export demand, traders said.

Losses in Malaysian palm oil futures overnight and a downturn in global crude oil futures added to the downward price slide seen in canola.

The arrival of significant precipitation overnight in the previously dry regions of west-central Saskatchewan and much of Alberta were also being viewed with a bearish attitude by market participants, brokers said.

There were ideas that the rain was too little too late to be of benefit to crops in a number of regions, but there was also sentiment that the moisture would prevent some crops from deteriorating further.

The losses in canola were being tempered by the lack of farmer deliveries being made into the cash pipeline and by the pricing of previously conducted export business, brokers said. Some scale down domestic crusher demand was also evident.

There were an estimated 4,809 canola contracts traded at 10:50 CDT. Of the contracts traded, 408 were spread related.

There were 16 western barley futures traded as of 10:50 CDT with most of that activity believed to be spreading between commercials, brokers said.

Prices in Canadian dollars per metric ton at 10:50 am CDT: