By Dwayne Klassen, Commodity News Service Canada
May 30, 2013
Winnipeg – Canola futures on the ICE Canada trading platform finished Thursday’s session on a firmer footing after experiencing losses for a good portion of the day. Good commercial demand as well as the buying back of previously sold positions by speculative and commodity fund accounts helped to spur the late day rally, market watchers said.
CBOT soybean futures also moved off their lows of the session towards the close, which helped to encourage some of the upward price action seen in canola.
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Much of the commercial demand that surfaced in new crop canola was said to be pricing routine export business as well as covering some domestic crusher needs, traders said.
The need to build a weather premium into canola futures also added to the friendly price tone.
The upside in canola was tempered by the upswing in the value of the Canadian dollar on Thursday. Elevator company hedge selling, tied to a pick up in farmer deliveries of canola into the cash pipeline, also capped some of the upside price potential.
Some of the early selling in canola was associated with the taking of profits by a variety of market participants, brokers said. Sentiment that a good portion of the canola crop in western Canada has now been put into the ground and was off to a fairly good start, also had spurred some early selling interest.
The ample South American soybean supply situation and the large soybean crop prospects in the US had also influenced some of the early price weakness in canola, traders said.
There were an estimated 15,592 canola contracts traded Thursday, down from the 27,533 contracts that changed hands during the previous session. Of the contracts traded, 8,502 were spread related.
No milling wheat, durum or barley contracts were traded during the session.
Prices are in Canadian dollars per metric ton.
