By Phil Franz-Warkentin, Commodity News Service Canada
July 5, 2013
Winnipeg – ICE Futures Canada canola contracts closed higher on Friday, as short-covering ahead of the weekend provided support.
Weakness in the Canadian dollar, which was down by over half a cent relative to its US counterpart on Friday, contributed to the firmer tone in canola. The weaker currency helps crush margins improve and also makes exports more attractive. Domestic crushers were noted buyers, according to participants.
Uncertainty over new crop production was also said to be underpinning the market, with heat stress being noted in some fields and excessive moisture a continuing concern in other parts of western Canada.
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However, conditions remain favourable for crop development across the majority of the Prairies, which limited the upside potential, said participants.
Declines in CBOT soybeans also put some pressure on the canola market, although the influence of the US losses was subdued by the fact that canola had already moved lower on Thursday when US markets were closed for Independence Day.
About 7,997 canola contracts were traded on Friday, which compares with Thursday when 1,587 contracts changed hands.
Milling wheat, durum and barley futures were untraded and unchanged on Friday.
Settlement prices are in Canadian dollars per metric ton.
