By Phil Franz-Warkentin, Commodity News Service Canada
May 1, 2013
Winnipeg – ICE Futures Canada canola contracts closed lower on Wednesday, as speculators bailing out of long positions and spillover from the declines in the CBOT soy complex weighed on values.
Increased soybean movement from Brazil, expectations for a large US crop, and concerns over an economic slowdown in China accounted for much of the weakness in CBOT soybeans, which provided the catalyst for the losses in canola, according to participants.
Speculative long liquidation was a feature in canola, with much of that selling tied to participants squaring positions and booking profits ahead of any possible surprises in Friday’s Statistics Canada stocks report.
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The report will show total Canadian canola supplies as of March 31, and should help provide an indication as to how much old crop supplies need to be rationed going forward.
Scale-down end user demand, from both exporters and domestic crushers, provided some support and limited the losses in canola, said participants.
Ongoing concerns over planting delays across western Canada, with much of the Prairies still cool and wet, helped underpin the futures as well.
About 20,516 canola contracts were traded on Wednesday, which compares with Tuesday when 15,404 contracts changed hands. Inter-month spreading was only a minor a feature, accounting for about 4,376 of the contracts traded.
Milling wheat, durum and barley futures were untraded and unchanged on Wednesday.
Settlement prices are in Canadian dollars per metric ton.
