Canola Futures Decline on Weak CBOT Soybean Values and Canadian Dollar Strength

Canola futures on the Winnipeg Commodity Exchange were trading at mainly lower levels at mid-session, with declines attributed to weak CBOT soybean values and continued strength in the Canadian dollar. The losses in the canola market were also influenced by large supplies in Western Canada and sentiment that Statistics Canada will raise its canola crop estimate in the next production report. Light elevator company hedge selling and the absence of fresh demand for western barley futures also contributed to the decline in prices.

Key Takeaways:

• Canola futures were trading at mainly lower levels at mid-session, with declines attributed to weak CBOT soybean values and continued strength in the Canadian dollar.
• Large supplies of canola in Western Canada and the anticipation of a raised canola crop estimate by Statistics Canada contributed to the downward price action.
• Light elevator company hedge selling and the absence of fresh demand for western barley futures contributed to the decline in prices.
• Spreading of the Jan/March contracts was the main feature of the activity in canola, with close to 2,500 contracts traded.
• Western barley futures were mainly lower in thin trade, with declines associated with losses in CBOT corn futures and the absence of fresh demand from end-users.
• Feed wheat futures were buoyed by the absence of significant farmer deliveries to the country elevator system overnight and by light commercial bidding.

Statistics:

• An estimated 4,985 canola contracts had changed hands at mid-session.
• Close to 2,500 contracts of Jan/March canola spreads were traded.
• 230 feed wheat contracts had changed hands at mid-session.
• 282 western barley contracts had traded at mid-session.

Sources:

• Resource News International via COMTEX
• Winnipeg Commodity Exchange (WCE)
• Statistics Canada
• CBOT (Chicago Board of Trade)