By Phil Franz-Warkentin, Commodity News Service Canada
Jan. 29, 2013
Winnipeg – ICE Futures Canada canola contracts were mixed at Tuesday’s close, retreating from earlier gains in the front months as losses in the new crop contracts weighed on values. Follow-through speculative buying on Monday’s firmer close helped prop up the nearby contracts for most of the day. Solid end user demand was also supportive.
The March contract tested upside resistance around C$621 per tonne, but was unable to break above that key chart point. The failure from a technical perspective triggered some profit-taking, according to participants.
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Reaction to Agriculture and Agri-Food Canada’s first supply/demand projections for the 2013/14 crop also accounted for some of the selling pressure. The market analysis branch forecast a slight decline in Canadian canola acreage, but a return to trend-line yields would see production rise to 15.5 million tonnes. That would be well above the 13.3 million tonne crop grown in 2012.
Increased farmer selling and the firmer tone in the Canadian dollar were also bearish for canola values, according to participants.
About 17,856 canola contracts were traded on Tuesday, which compares with Monday when 16,985 contracts changed hands. Spreading accounted for about 10,278 of the contracts traded.
Milling wheat, durum, and barley futures were untraded and unchanged.
Settlement prices are in Canadian dollars per metric ton.
