By Dwayne Klassen, Commodity News Service Canada
May 22, 2013
Winnipeg – Canola futures on the ICE Canada trading platform finished Wednesday’s session on a strong footing with the downswing in the value of the Canadian dollar and late day commodity fund and speculative demand accounting for the advances, market watchers said.
The strength displayed by CBOT soybean and soyoil futures also spilled over to generate the upward price action.
Some of the support in canola also came from the tight old crop supply situation and the reluctance of farmers to sell the commodity into the cash market, brokers said. Farmers were said to be concentrating on spring fieldwork and seeding and not the marketing of the product.
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The buying back of previously sold positions helped to fuel some of the price gains with the triggering of buy-stop orders on the way up amplifying the upward price push, brokers said.
The taking of profits helped to slow the price advance in canola as did the mostly favourable weather conditions on the Canadian prairies for seeding operations.
The glut of soybeans available on the global market from South America also capped the upside price potential in canola.
There were an estimated 18,520 canola contracts traded Wednesday, up from the 14,286 contracts that changed hands during the previous session. Of the contracts traded, 9,928 were spread related.
No milling wheat, durum or barley contracts were traded during the session.
Prices are in Canadian dollars per metric ton.
