By Dwayne Klassen, Commodity News Service Canada
March 18, 2013
WINNIPEG – Canola futures on the ICE Canada trading platform ended Monday’s session on a mixed footing with losses being eroded later in the day by the buying back of previously sold positions and by a late pick up in commercial demand, market watchers said.
Canola had traded at lower levels for a good portion of the session reacting to the weakness in the outside oilseed sector, including Malaysian palm oil, European rapeseed futures, and the declines seen in the CBOT soybean complex.
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Some of the selling seen in canola also came from the ongoing harvest of a record large soybean crop in South America and from word those cheaper supplies were finally making their way onto the world market, traders said.
The unloading of positions by investors, tied in part to renewed economic worries in Europe, also had stimulated some of the downward price action, brokers said.
Chart-based speculative and commodity fund liquidation orders had also been evident earlier in the session and contributed to the bearish price sentiment.
However, near the close, participants began to buy back short positions, which in turn helped to turn the market around. A pick up in commercial buying interest near the close, believed to be covering domestic crusher and exporter interest further lifted canola, brokers said.
The weakness displayed by the Canadian dollar Monday was also viewed as supportive for canola futures.
The losses in canola were also restricted by concerns about tight old crop canola supplies.
There were an estimated 12,332 canola contracts traded Monday, down from the 13,259 contracts that changed hands during the previous session. Of the contracts that were traded, 7,634 consisted of spreads.
No milling wheat, durum or barley contracts were traded during the sessio.
Prices are in Canadian dollars per metric ton.
