By Dwayne Klassen, Commodity News Service Canada
February 20, 2013
WINNIPEG – Canola futures on the ICE Canada trading platform finished higher on Wednesday with steady demand from the commercial sector, prompted in part by the weak Canadian dollar, behind some of the upward price push, market watchers said.
The downswing in the value of the Canadian currency was said to have stirred up some fresh demand from both domestic processors as well as from export outlets, brokers said. The need to ration demand in order to limit the use of tight old crop canola supplies further underpinned values.
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The advances in CBOT soybean futures helped to provide a firm floor for canola as did a drop off in the movement of canola into the cash pipeline in western Canada, traders said. Light chart based speculative and commodity fund buying was also evident which further underpinned values.
The continued dryness issues in the soybean growing areas of Argentina further generated strength for canola, traders said.
The upside in canola was restricted in part by the taking of profits by a variety of market participants. Declines posted by CBOT soyoil and Malaysian palm oil futures also capped the upside price potential in canola, traders said.
Spreading continued to be a feature of the activity in canola and helped to bolster the volume total.
There were an estimated 24,994 canola contracts traded Wednesday, down from the 32,155 contracts that changed hands during the previous session. Of the contracts that changed hands, 18,446 were spread related.
No milling wheat, durum or barley contracts were traded. Durum values were increased at the close by ICE Canada.
Prices are in Canadian dollars per metric ton.
