By Phil Franz-Warkentin, Commodity News Service Canada
March 13, 2013
Winnipeg – Canola contracts on the ICE Futures Canada platform were weaker at 10:40 CDT Wednesday, with speculative selling and steady farmer hedges weighing on value.
Sharp losses in CBOT soybeans accounted for some of the spillover selling pressure in canola. Malaysian palm oil and European rapeseed futures were also lower in overnight activity.
Long liquidation by fund accounts was behind much of the weakness in soybeans which spilled into the Canadian market, according to a broker. He said the advancing soybean harvest in Brazil was causing investors to take some of the weather premiums that had built up in the North American futures.
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Western Canadian farmers were also said to be making steady sales, as cash prices remain profitable and the break in soybeans had producers lowering their expectations for further upside in the canola market, said the broker.
However, canola did lag soybeans to the downside, with the tightening supply situation in western Canada a supportive influence overall. Solid exporter and domestic crusher demand on a scale-down basis also helped underpin the futures.
The continued weakness in the Canadian dollar provided some support for canola as well, according to participants.
At 10:40 CDT, about 7,000 canola contracts had changed hands, with intermonth spreading only a small feature.
Milling wheat, durum, and barley futures were untraded and unchanged.
Prices in Canadian dollars per metric ton at 10:40 CDT:
