By Phil Franz-Warkentin, Commodity News Service Canada
June 18, 2013
Winnipeg – Canola contracts on the ICE Futures Canada platform were stronger at 10:47 CDT Tuesday, as routine commercial interest and spillover from the advances in CBOT soybeans provided support.
Technical signals contributed to the gains in canola, with Monday’s recovery off of early lows seen as supportive from a chart standpoint, according to participants.
Relatively good crop conditions across most of western Canada were setting the stage for a large canola crop, which did temper the upside in the market, according to a broker. However, he added that with the supply/demand outlook looking very tight “we need to grow a big canola crop just to keep things balanced.” As a result, traders were keeping some risk premiums in the market at this early stage of crop development.
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Farmers were also reluctant sellers as they wait to get a better handle on this year’s crop before committing aggressively, said the broker.
The Canadian dollar was weaker Tuesday morning, which was another supportive influence for canola.
The large South American soybean crop overhanging the oilseed markets did temper the upside potential in canola, according to traders.
At 10:47 CDT, about 10,000 canola contracts had changed hands, with the July/November spread a feature as participants continue to roll out of the front month.
Milling wheat, durum, and barley futures were untraded and unchanged.
Prices in Canadian dollars per metric ton at 10:47 CDT:
