By Dwayne Klassen, Commodity News Service Canada
January 21, 2013
WINNIPEG – Canola futures on the ICE Canada trading platform finished mixed to lower with the most active nearby contracts settling on the defensive Monday. Canola had traded on both sides of unchanged during the session.
With the US markets closed for the Martin Luther King Holiday few participants wanted to push canola futures to far one way or the other, market watchers said.
Some early support in canola was derived from the overnight advances posted by Malaysian palm oil and European rapeseed futures.
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Some light speculative and commodity fund buying, seen as an attempt to push the March canola futures above technical resistance, also helped to generate some of the upward price action. However, while resistance at C$600 was tested and even penetrated, the lack of followthrough buying on the other side, kept the advance restricted and values did end up with losses by the end of the day, brokers said.
The downswing in the value of the Canadian dollar helped to underpin canola futures, with the weaker Canadian currency making Canadian canola more attractive for foreign buyers, traders said.
A slow down in farmer selling, with few farmers wanting to load canola in the Arctic temperatures which have moved into the Canadian prairies, also providing some minor support.
Steady domestic crusher demand provided some support for canola as did the pricing of old export business.
The upside in canola was capped by the taking of profits and the mostly favourable weather for the development of the South American soybean crops.
Uncertainty as to which way CBOT soybean and soyoil futures will take when activity resumes, also limited the upside in canola, brokers said.
There were an estimated 9,360 canola contracts traded Monday, down from the 20,313 contracts that changed hands during the previous session. Of the contracts that changed hands, 9,268 were spread related.
No milling wheat, durum or barley contracts were traded. Barley futures were lowered at the close by ICE Canada.
Prices are in Canadian dollars per metric ton.
