ICE Canola Midday: Leaving its resistance level behind
Nov. contract continues above $600/tonne
Intercontinental Exchange canola futures continued upward at midday Wednesday, as the November canola contract pushed further above its former resistance level of C$600 per tonne.
A trader said the markets are essentially ignoring two important aspects. One of those being the strike by grain workers at the Port of Vancouver that started on Tuesday. He suggested the federal government is unlikely to allow the labour dispute to go on for any significant period of time. The other factor being China’s allegations of canola dumping by Canada.
He said short covering helped to fuel the increases in canola, but farmer selling tempered the gains.
The November contract surpassed its 20 and 50-day moving averages, which the trader said is supportive.
Gains in Chicago soybeans and soyoil, along with those in European rapeseed and Malaysian palm oil further underpinned canola, while a dip in Chicago soymeal limited further increases. Modest declines in crude oil attempted to apply pressure on the vegetable oils.
Statistics Canada issued its crush and grain deliveries reports this morning, showing the August canola crush at 850,529 tonnes, up 2.5 per cent from a year ago. Canola deliveries of 1.31 million tonnes this August climbed 34.7 per cent from the previous August.
By late Wednesday morning, the Canadian dollar was virtually unchanged with the loonie at 74.27 U.S. cents compared to Tuesday’s close of 74.25.
Approximately 42,100 canola contracts were traded as of 10:48 am CDT, with prices in Canadian dollars per metric tonne:
Price Change Canola Nov 606.70 up 3.10 Jan 618.80 up 2.70 Mar 629.10 up 1.30 May 636.50 up 0.50
