By Phil Franz-Warkentin, Commodity News Service Canada
WINNIPEG, Sept. 29 – ICE Canada canola contracts were stronger Tuesday morning, as advances in outside vegetable oil markets, the weaker Canadian dollar, and solid end user demand all underpinned the futures.
The Canadian dollar fell below the psychological 75 US cent level on Monday and was weaker again on Tuesday. The softer currency helps crush margins and also makes Canadian canola more attractive to international buyers.
The nearby technical bias has also shifted back to the upside, according to analysts, which accounted for some of the speculative buying.
However, improving production ideas as the Canadian harvest advances did put some pressure on values. Statistics Canada releases updated survey estimates on the size of this year’s crop on Friday, and most market participants are anticipating an upward revision from the previous report.
Ideas that canola is looking overpriced compared to other oilseeds also served to temper the upside.
About 5,300 canola contracts had traded as of 8:47 CDT.
