By Dwayne Klassen, Commodity News Service Canada
January 8, 2013
WINNIPEG – Canola futures on the ICE Canada trading platform finished mixed to higher after trading on both sides of the plus/minus line during Tuesday’s session. Early weakness was linked to the lack of follow-through buying from Monday’s rally. Weakness displayed by CBOT soybean futures and some light profit-taking also helped to fuel some of the early downward price action, market watchers said.
The evening up of positions ahead of new supply/demand tables scheduled to be released on Friday by the USDA was also a feature of the trade in canola, brokers said.
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Some underlying support in canola continued to come from tight supply concerns with commercials having trouble securing nearby export commitments. Domestic processors were also having to pay premiums in order to entice farmers to deliver canola into the cash pipeline, brokers said. As a result some of the firmness in the cash market was helping to bolster futures prices.
A small downswing in the value of the Canadian dollar helped to underpin canola futures. Talk of dryness in some of the soybean growing areas of Argentina was also viewed as supportive for canola prices, traders said.
The upside in canola was tempered by chart-related liquidation by speculative and commodity fund accounts. The taking of profits at the highs of the day also restricted some of the price strength seen in canola. The downward price slide seen in CBOT soyoil at the close also moved canola off its highs.
There were an estimated 14,861 canola contracts traded Tuesday, up from the 12,690 contracts that changed hands during the previous session. Of the contracts that changed hands, 11,396 were spread related.
No milling wheat, durum or barley contracts were traded.
Prices are in Canadian dollars per metric ton.
