By Jade Markus, Commodity News Service Canada
WINNIPEG, December 15 – ICE Canada canola contracts were mixed, but mostly lower, at midday Tuesday, weighed down by weakness in Chicago Board of Trade soy contracts and Malaysian palm oil.
Canola contracts weren’t seeing any aggressive selling at midday, so weakness in other markets quietly dragged canola lower, said one Winnipeg-based trader.
He added that spread activity has been good in the January/March contract.
“We basically believe that the funds are sitting on their hands, just kind of waiting—not sure anymore. Everybody is waiting to see if the Federal Reserve will raise rates tomorrow,” the trader said.
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He expects an interest rate boost in the US should cause canola markets to move higher, as the US dollar rallies, sending additional downward pressure to the Canadian dollar.
But the rate hike could already be baked into current prices he said, and could leave the market little-affected.
“We could have that ‘buy the rumour, sell the fact,’ reaction—a kind of non-reaction on what’s been talked about for a couple years here.”
The Canadian dollar was weaker at midday on Tuesday.
About 12,280 canola contracts had traded as of 10:45 CST.
Milling wheat, durum, and barley futures were all untraded and
unchanged.
Prices in Canadian dollars per metric tonne at 10:45 CST:
