CNS Canada — ICE Futures Canada canola contracts moved lower overall during the week ended Wednesday, as the bearish influence of the rising Canadian dollar countered any spillover support from gains in CBOT soybeans.
CBOT soybeans climbed sharply over the course of the week. However, the Canadian dollar has also posted solid gains over the past week and soyoil held relatively steady.
“Canola traders are hanging back and waiting to make sure that soybeans will hold up, because the fundamentals in soy haven’t changed,” said Ken Ball of PI Financial in Winnipeg.
Continued strength in soybeans could pull canola higher in the short term, but added that “a lot of selling will eventually hit the soybean market… as traders are getting a little leery about the bean rally.”
Aside from the outside influence of soybeans, demand for canola is steady from both exporters and domestic crushers, said Ball.
Weather issues in parts of Western Canada were also being watched, with dryness in the west and the possibility of excess moisture in the east, he said.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.