By Phil Franz-Warkentin, Commodity News Service Canada
August 2, 2013
Winnipeg – Canola contracts on the ICE Futures Canada platform were stronger at 11:10 CDT Friday, as speculative short-covering, the weaker Canadian dollar, and spillover from the advances in CBOT soyoil all provided underlying support.
After setting fresh contract lows earlier this week, canola has bounced higher for the past three sessions as speculators continue to book profits on some of those short positions.
The Canadian dollar was weaker on Friday, which added to the firmer tone in canola, as the softer currency was said to be encouraging some end user demand.
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Cooler than normal temperatures across western Canada were also providing some support, according to participants, as the uncertainty over weather conditions going forward served to keep some risk premiums in the futures.
However, the crop conditions remain relatively favourable overall, which tempered the upside potential, said traders. Losses in CBOT soybeans were also overhanging the market.
The general technical trend remains pointed lower for canola, making any advances good selling opportunities from a chart standpoint, said analysts. The most active November contract was trading just below the psychological C$500 per tonne session at midsession.
At 11:10 CDT, about 10,000 canola contracts had changed hands.
Milling wheat, durum, and barley futures were untraded and unchanged.
Prices in Canadian dollars per metric ton at 11:10 CDT:
