ICE Canola Closes Lower On Bearish USDA Report Impact

By Dwayne Klassen, Commodity News Service Canada


Winnipeg – November 9/12 – Canola futures on the ICE Canada trading platform finished Friday’s session with significant losses with much of the downward price action associated with the bearishly construed USDA supply/demand report and its negative price impact on the CBOT soybean complex, market watchers said.


The report essentially increased US and world soybean supplies as well as increased US soyoil carry-out stocks.


Some of the weakness in canola also reflected the liquidation of positions ahead of the three day weekend in Canada. The ICE Canada trading platform will be closed on Monday, November 12 in observance of Remembrance Day.


Bearish chart signals contributed to the downward price action in canola with a number of support levels failing to hold. Speculators and commodity funds were some of the featured sellers during the session, traders said.


The activation of sell-stop orders amplified the price declines.


Additional weakness in canola was linked to the improved weather conditions for the planting and development of the South American soybean crop. Private estimates calling for increased soybean acreage in the US next spring, also contributed to the bearish sentiment in canola, traders said.


The declines in canola were restricted in part by steady commercial demand. Much of that interest was said to be covering old export business as well as some domestic crusher needs.


There were an estimated 14,157 canola contracts traded Friday, up from the 7,411 contracts that changed hands during the previous session. Of the contracts that changed hands, 7,796 were spread related.


Milling wheat, barley and durum contracts were untraded and unchanged.


Prices are in Canadian dollars per metric ton.

Commodity futures

Futures Prices as of August 20, 2014

Canola Price Change
January591.408.80
March589.408.60
May586.508.20
Milling Wheat Price Change
December310.30
March319.80
Durum Price Change
December312.40
March319.00
New Barley Price Change
December250.00
March253.00

Prices are in Canadian dollars per metric ton