ICE canola down with technical selling

By Terryn Shiells, Commodity News Service Canada

July 15, 2013

WINNIPEG – Canola contracts on the ICE Futures Canada platform were weaker at 10:43 CDT Monday, with some of the downward price action linked to technical selling.

Speculators were said to be liquidating long positions after the November contract broke through the key technical support level of C$530 per tonne, brokers noted, adding that the new support level of C$520 per tonne should hold for the rest of the week.

Spreading between canola and soybeans, as traders were buying soybeans and selling canola, was also bearish for the commodity.

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Some of the weakness in the market may also be linked to a pickup in farmer selling, as producers are more confident that they’ll harvest a good crop this fall, analysts said.

Talk that most western Canadian canola crops are developing well amid generally favourable weather conditions added to the selling pressure.

However, some spill over support from the advances seen in Chicago soybeans helped to limit the downside in canola.

Weakness in the value of the Canadian dollar also served to temper the losses, as it made canola less expensive to international buyers.

As of 10:43 CDT, about 11,120 canola contracts had traded.

Milling wheat, barley and durum were untraded and unchanged.

Prices in Canadian dollars per metric ton at 10:43 CDT:

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