Intercontinental Exchange canola futures continued to pull back at midsession Tuesday, adding to yesterday’s sharp declines.
Pressure on canola was coming from steep losses in Chicago soyoil, as well as soybeans and soymeal, a trader noted.
He said canola has been holding up pretty well compared to soyoil, but the latter has dropped so much and so quickly that “canola is going to get pulled down.”
Added to that were losses in European rapeseed and Malaysian palm oil. Also, small declines in crude oil weighed on the oilseeds.
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Another factor in canola’s pullback was the Prairie weather. The trader said there’s enough soil moisture and humidity that the crops can withstand the higher temperatures in the forecast.
As well, he pointed to the spec funds which he said were remaining short when at this time of year they switch to being long.
“The specs could get caught being short if the weather changes,” the trader commented.
The Canadian dollar was slightly lower as of late Tuesday morning, with the loonie at 73.30 U.S. cents compared to Monday’s close of 73.35.
Approximately 31,200 canola contracts were traded as of 10:39 am CDT, with prices in Canadian dollars per metric tonne:
Price Change Canola Nov 638.70 dn 9.70 Jan 648.20 dn 10.00 Mar 656.10 dn 9.70 May 662.10 dn 9.20
