By Terryn Shiells, Commodity News Service Canada
August 26, 2013
WINNIPEG – ICE Futures Canada canola contracts closed sharply higher on Monday, as they rallied alongside Chicago soybeans.
Much of the upward price action in both commodities was linked to concerns about adverse hot, dry weather reducing yield potential for soybeans in the US, analysts said.
Technical based buying further underpinned values, as did some short covering by speculative accounts, according to brokers.
Worries about early frost possibly causing damage to Canadian canola crops were also bullish, as was a pickup in crusher buying.
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Buy stops were hit on the way up and helped to amplify the price advances.
However, farmers were eager sellers at the highs of the day, which helped to limit the upside potential in canola.
Expectations that the Canadian canola crop will be very large this year, even as big as 16 million tonnes, were also bearish.
About 35,303 canola contracts were traded on Monday, which compares with Friday when 26,021 contracts changed hands.
Milling wheat, durum and barley futures were untraded and unchanged on Friday after experiencing some slight price revisions after the close on Friday.
Settlement prices are in Canadian dollars per metric ton.
