ICE Canola Futures Weaken On Large Stocks, Weak CBOT
| 2 min read
| By Dwayne Klassen, Resource News International |
| September 9, 2009 |
| Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at mainly lower price levels as of 9:47 EDT. Declines were associated with the Statistics Canada grain stocks in all positions report which was deemed as neutral to slightly bearish for canola and the losses seen overnight in the outside oilseeds, market watchers said.
In the early activity the nearby November contract was the mostly actively traded. Declines overnight in e-CBOT soybeans, Malaysian palm oil and European rapeseed values helped to weigh on canola. Adding to the price weakness in canola were the lower calls for CBOT soybeans and soyoil with the start of the North American day session, traders said. Statistics Canada pegged ending stocks of Canadian canola as of July 31, 2009 at 1.661 million metric tons. Pre-report expectations had pegged canola carryover at 1.300 million to 1.700 million tons. Ending stocks of canola at the same time a year ago were 1.462 million tons. Brokers said the perception among market participants is that the Canadian canola crop is getting bigger which in turn will spark some selling. The good weather conditions over much of western Canada over the past ten days was believed to have helped canola mature and allowed producers to make some significant harvest progress. Strength in the Canadian dollar and the absence of fresh export demand was seen helping to weigh on canola futures during the session, brokers said. Underlying support in canola was expected to come from ideas that canola is oversold and is in need of an upward correction, brokers said. Support in canola was also seen stemming from the slow pace of farmer selling as farmgate bids have dropped below $9/bu in much of Western Canada. Talk of cool conditions appearing in Western Canada also were expected to provide some support as canola crop development continues to lag behind. Readings in the Peace River region of northern Alberta were said to have dropped to around the 1 to 2 degree Celsius range overnight, with readings in some low lying areas dropping below the freezing level of zero degrees Celsius, brokers said. No significant frost damage was reported, traders said. As of 9:47 am EDT, there were 706 canola contracts traded. As of 9:47 EDT, no western barley contracts had changed hands |
