By Glen Hallick, MarketsFarm
WINNIPEG, March 22 (MarketsFarm) – ICE Futures canola contracts are down significantly at midday Friday, following yesterday’s statement from the Canola Council of Canada that said China is no longer buying canola from Canada.
The council’s statement said previous sales to China are still being carried, but there haven’t been any new sales.
“We’re having a knee-jerk reaction to that news. There’s no quick fix here,” said a Winnipeg-based analyst.
The market has been well aware of a slowdown in China’s imports of canola from Canada since the beginning of the year, following the arrest of Huawei executive Meng Wanzhou in December, the analyst stated.
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“If China has bought anything it’s been pretty light,” he said, noting he doubts China would completely end its canola purchases from Canada.
The situation was further exacerbated earlier this month when Richardson International had its permit revoked by China to sell canola to the country.
As for Friday’s heavy volume of trade, the analyst saw it as, “the spec funds piling into the short side again.”
About 20,700 canola contracts were traded as of 10:48 CDT.
Prices in Canadian dollars per metric tonne at 10:48 CDT:
Price Change
Canola May 458.70 dn 9.50
Jul 467.30 dn 9.30
Nov 479.90 dn 9.40
Jan 486.30 dn 8.70
