By Dwayne Klassen, Commodity News Service Canada
Winnipeg – October 23/12 – CNS – Canola contracts on the ICE Futures Canada platform were trading in a narrowly mixed range at
10:36 CDT Tuesday morning. Light commercial demand was helping to provide a firm floor for a few contracts while the sell-off in the outside oilseed markets was bearish for values, market watchers said.
Sentiment that canola was undervalued in comparison to CBOT soybeans also generated some underlying support, brokers said.
Much of the commercial interest was said to be covering domestic crusher needs as well as old export business. The reluctance of farmers to sell canola into the cash pipeline amid the tighter than anticipated canola supply outlook, also provided some underlying support.
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Weakness overnight in Malaysian palm oil and European rapeseed futures helped to fuel some of the price weakness in canola, traders said. Losses in CBOT soybean and soyoil values were also bearish for canola.
The improved conditions for the planting of the South American soybean crop also tempered the buying in canola. The Canadian dollar was experiencing some strength early Tuesday which further curbed the upside price potential in canola.
A lot of the volume seen in canola consisted of spreading, with commercials and commodity funds seen rolling positions out of the nearby November future and into the January contract.
As of 10:36 CDT, about 9,657 canola contracts had traded. Of the contracts traded, 5,726 were spread related.
Milling wheat, durum and barley contracts were unchanged and untraded.
Prices in Canadian dollars per metric ton at 10:36 CDT:
