By Dwayne Klassen, Commodity News Service Canada
April 24, 2013
Winnipeg – Canola futures on the ICE Canada trading platform finished on a weaker note Wednesday with late day profit=-taking and a drop off in commodity fund demand linked to the declines, market watchers said.
Commodity fund accounts had been good buyers early in the session, with some of that interest triggered by the Statistics Canada acreage estimate for canola.
The government agency early Wednesday projected 2013 canola area in Canada at 19.133 million acres. This would compare with the 21.531 million acres seeded in 2012 and pre-report estimates ranging from 20.000 million to 21.251 million acres.
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However, there were also ideas that some of the fund interest was an attempt to trigger some buy-stops above current levels. This buying interest was said to have faded heading into the close, allowing for the downward push in canola, brokers said.
Additional support in canola earlier in the day had stemmed from the steady usage of the commodity by domestic crushers as well as export outlets, brokers said. The absence of significant farmer deliveries of canola into the cash pipeline further lifted canola futures.
Some of the strength in canola was also linked to the delays in planting the crop on the Canadian prairies due to wet and cold weather conditions, traders said.
Gains in CBOT soyoil futures also encouraged some of the buying in canola, but the declines in CBOT soybeans restricted the upside price potential and helped to push values down at the close, traders said.
There were an estimated 28,926 canola contracts traded Wednesday, up from the 22,802 contracts that changed hands during the previous session. Of the contracts traded, 15,768 were spread related.
No milling wheat, durum or barley contracts were traded during the session.
Prices are in Canadian dollars per metric ton.
