Canola and Feed Grain Futures Down at Winnipeg Commodity Exchange

Strategic Insights -

Heavy losses in the CBOT soy complex spilled over to the Winnipeg market, with canola futures down due to follow-through technical selling and overnight weakness in Malaysian palm oil futures. RBC Investments was a notable seller, with market activity believed to be commodity fund-related. The Jly contract dropped below support at C$375.00, leading to fund selling and the development of a short position. Commercial buying and export sales of 2,000 to 3,000 metric tons of Canadian canola to Japan provided some support to the market.

Key Takeaways:

  • Canola futures were down at midday due to follow-through technical selling from Friday's sharply lower close.
  • Large losses in CBOT soybeans accounted for much of the bearish tone in the canola pit.
  • Overnight weakness in Malaysian palm oil futures also weighed on canola.
  • RBC Investments was a notable seller of canola futures.
  • The Jly contract dropped below support at C$375.00, leading to fund selling and the development of a short position.
  • Commercial buying and export sales of 2,000 to 3,000 metric tons of Canadian canola to Japan provided some support to the market.
  • Western barley values were down at midday due to early weakness in CBOT corn and spillover pressure from losses in canola and soybeans.
  • CBOT corn values have since turned higher, supporting barley prices.
  • Gains in CBOT wheat also helped underpin the market.

Statistics:

  • Canola futures were down at midday.
  • The Jly contract dropped below support at C$375.00.
  • 2,000 to 3,000 metric tons of Canadian canola were sold to Japan on the spot cash market.
  • CBOT corn values were down initially, but turned higher.
  • Western barley values were also down initially, but stabilized due to gains in CBOT corn.

Sources:

  • Resource News International via COMTEX, May 17, 2004.
  • Winnipeg Commodity Exchange (WCE), floor sources.
  • RBC Investments, notable seller.
  • Philip Franz-Warkentin, Resource News International.
  • COMTEX (http://www.comtexnews.com)