By Dwayne Klassen, Commodity News Service Canada
March 6, 2013
WINNIPEG – Canola futures on the ICE Canada trading platform finished Wednesday’s session on a firmer footing with good support stemming from the downswing in the value of the Canadian dollar, market watchers said.
The drop in the value of the Canadian currency was said to have stimulated some good demand from both the export and domestic sectors. With the pick up in demand, concerns about tight old crop canola supplies also increased, which in turn added to the bullish price tone in the market, brokers said.
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Chart-based buying from speculative and commodity fund accounts was also evident during the session, adding to the support in the market.
The late upturn in CBOT soyoil futures also encouraged some of the price strength displayed by canola.
The upside in canola was kept in check by the taking of profits at the highs of the day. Steady elevator company hedge selling, spurred on by a pick up in farmer deliveries of canola into the cash pipeline further tempered the price climb. Much of the farmer selling was initiated by the premiums being offered in the cash market by the grain companies, brokers said.
The activity in canola was described by market participants as choppy, with position evening ahead of Friday’s updated supply/demand reports from the USDA a feature of the trade.
Spreading was a feature of the activity in canola and helped to bolster the volume total.
There were an estimated 17,137 canola contracts traded Wednesday, up from the 16,874 contracts that changed hands during the previous session. Of the contracts that were traded, 8,424 consisted of spreads.
No milling wheat, durum or barley contracts were traded.
Prices are in Canadian dollars per metric ton.
