By Phil Franz-Warkentin, Commodity News Service Canada
August 15, 2014
Winnipeg – Canola contracts on the ICE Futures Canada platform were weaker at midday Friday, setting fresh lows as speculators added to short positions and losses in CBOT soyoil put some spillover pressure on the market.
Some sell-stops were likely hit on the way down, which likely contributed to the declines, said participants. The November contract fell to as low as C$424.50 per tonne at one point, well below the previous low of C$429.10 set in July.
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The continued weakness in soyoil has caused crush margins to deteriorate to their lowest levels in years, according to a trader. The softening crush margins are a sign that canola is becoming overpriced relative to its product values, which means values may have even more room to the downside, he added.
A lack of farmer selling given the continued uncertainty over the size of the Canadian crop also helped limit the losses, with dryness in some parts of the Prairies raising some concerns.
About 13,000 canola contracts had traded as of 10:50 CDT.
Milling wheat, durum, and barley futures were untraded and unchanged.
Prices in Canadian dollars per metric ton at 10:50 CDT:
