By Phil Franz-Warkentin, Commodity News Service Canada
May 15, 2013
Winnipeg – ICE Futures Canada canola contracts were higher on Wednesday, seeing some independent strength relative to the CBOT soy complex as bullish technical signals, tight old crop supplies, and uncertainty over new crop production were all supportive.
Recent activity in the canola market has shifted the technical bias to the upside, and speculative short-covering was a feature accounting for some of Wednesday’s strength, according to participants.
In addition to the supportive technicals, canola was also underpinned by the tight supply situation and steady end user demand, said traders.
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While warm and dry weather conditions across most of western Canada are expected to allow farmers to make some good seeding progress over the next few days, the forecasts are turning wetter for the weekend. The likelihood of further planting delays and the general uncertainty over new crop production was said to be providing some support for canola as well.
The CBOT soy complex was mostly lower on Wednesday, and the softer tone there did serve to temper the upside in canola, according to traders.
About 14,170 canola contracts were traded on Wednesday, which compares with Tuesday when 10,188 contracts changed hands.
Milling wheat, durum and barley futures were untraded and unchanged on Wednesday.
Settlement prices are in Canadian dollars per metric ton.
