ICE Canola Weakens On CBOT Soybean Drop, Good Weather

ICE Canola Weakens On CBOT Soybean Drop, Good Weather

By Dwayne Klassen, Resource News International

September 14, 2009

Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at lower price levels with the declines in the CBOT soybean complex and the good weather for crop development in western Canada linked to the weakness, market watchers said.

The nearby November, January and March contracts were the contracts experiencing most of the early action.

Early selling in canola was initiated by the losses seen overnight in the e-CBOT soybean complex and the declines posted by Malaysian palm oil and European rapeseed values, brokers said.

The losses in canola were also stimulated by the mostly weaker opening in both CBOT soybean and soyoil futures with the start of the North American day session. However, as the losses in soybeans and soyoil were eroded, the declines in canola were also minimized.

Contributing to the bearish price tone in canola were the warm temperatures and sunshine across much of western Canada which was helping the maturity process of canola. Producers were said to be making good harvest progress across the Canadian prairies in view of the warmer than normal weather conditions, traders said.

The absence of a frost in the nearby weather outlook further weighed on prices.

Some underlying support in canola was coming from the depreciation of the Canadian dollar and from steady commercial demand under the market, traders said.

The commercial interest was said to be covering both domestic requirements and recently conducted export sales, brokers said.

There were an estimated 4,079 canola contracts traded at 10:34 CDT.

There were no western barley futures traded as of 10:34 CDT.

Prices in Canadian dollars per metric ton at 10:34 am CDT:

Price Change
Canola
Nov 392.60 dn 1.60
Jan 396.60 dn 1.80
Mar 398.30 dn 2.10

Western Barley
Oct 113.10 unchanged
Nov 142.80 unchanged