ICE Canola Futures Drop On Outside Declines
| 2 min read
| By Dwayne Klassen, Resource News International |
| September 28, 2009 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at weaker price levels as of 9:51 EDT. Some of the declines in canola reflected the sell-off seen overnight in the e-CBOT soybean complex as well as the losses seen in Malaysian palm oil and European rapeseed, market watchers said.
The downward price action in canola also came in anticipation of the lower calls for CBOT soybeans and soyoil with the start of the North American day session, brokers said. The rapid pace of the canola harvest, with over 60% of the crop said to be combined, also an undermining price influence. Light chart based speculative offerings and a drop off in fresh export demand was also contributing to the weakness in canola, traders said. A decline in domestic crusher demand for canola, due to problems in selling canola meal into the US because of salmonella contamination, also was being viewed as an undermining price influence. The production report scheduled to be released Friday by Statistics Canada will also garner more attention as the week progresses, traders said. Most market participants are anticipating larger production numbers for canola relative to the August survey released by the government agency. Some underlying support in canola was coming from talk of frost overnight in parts of Alberta and a large area of Saskatchewan. Frost warnings for Manitoba are also in pace for Monday night. Brokers said much of the support will be ‘psychological’ in nature. Weakness in the Canadian dollar early Monday was seen as mildly supportive for canola with slow producer sales into the cash market in Western Canada also an underpinning price influence. As of 9:51 am EDT, there were 189 canola contracts traded. As of 9:51 EDT, no western barley contracts had changed hands. More liquidation of the October contract was anticipated Monday as the contract will be de-listed at its expiration. |
