ICE Canola Futures Ease On Bearish USDA Soybean Data
| 1 min read
| By Dwayne Klassen, Resource News International |
| September 30, 2009 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at weaker price levels as of 9:38 EDT. Weakness in canola was linked to the advancing harvest in western Canada and to the bearish interpreted USDA report for CBOT soybean values, market watchers said.
Market participants were expecting CBOT soybean values to be down at least 5 to 7 US cents per bushel at the start of the North American day session in response to the quarterly stocks number for US soybeans coming in above pre-report expectations. Reports of exceptional soybean yields in the US were also fuelling that downward price action. Some evening up of positions was anticipated ahead of Friday’s Statistics Canada crop production update. Pre-report expectations are calling for an extremely large canola crop, with most participants anticipating that Canada’s 2009/10 (Aug/Jul) canola production will be anywhere from 10.5 to over 11.0 million metric tons. The government agency in August pegged canola output at 9.541 million tons while production in 2008/09 totalled 12.642 million. Weakness in canola was also stemming from steady country movement and firmness in the Canadian dollar in early Wednesday morning activity. Losses in Malaysian palm oil overnight was also viewed as an undermining price influence for canola. Declining domestic crusher demand for canola was also seen as bearish for futures. Some underlying support for canola will come from the pricing of old export business. Supportive price influences for canola will also come from outside markets, including strength in energy, metal and equities, brokers said. As of 9:38 am EDT, there were 1,124 canola contracts traded, with the rolling of positions by large index funds tied to some of that volume, traders said. As of 9:38 am EDT, no western barley contracts had been traded.
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