Winnipeg Commodity Exchange: Canola Futures Fall to New Lows Amid Heavier Deliveries and Bearish Technical Signals

Strategic Insights -

The Winnipeg Commodity Exchange (WCE) experienced a mixed session on Tuesday, with canola futures dropping to new contract lows due to heavier-than-expected deliveries against the January futures contract. According to floor sources, an estimated 5,141 contracts traded, up from the previous Friday's 1,657 contracts. The decline in Chicago Board of Trade soybean futures on Monday, when the WCE was closed, also contributed to the weakness in canola futures. Furthermore, bearish technical signals and commodity fund selling led to modest amounts of speculative selling. However, the steep decline in the Canadian dollar and slow farmer selling due to cold snowy conditions in western Canada provided some support. Commercial buying, particularly from crushers, was noted, and the selling was attributed to both speculative and commercial activities.

Key Takeaways:

  • Canola futures fell to new contract lows due to heavier-than-expected deliveries against the January futures contract.
  • An estimated 5,141 contracts traded at the WCE, up from the previous Friday's 1,657 contracts.
  • The decline in Chicago Board of Trade soybean futures on Monday contributed to the weakness in canola futures.
  • Bearish technical signals and commodity fund selling led to modest amounts of speculative selling.
  • The steep decline in the Canadian dollar and slow farmer selling due to cold snowy conditions in western Canada provided some support for canola futures.
  • Commercial buying, particularly from crushers, was noted, and the selling was attributed to both speculative and commercial activities.
  • Fimat and Refco were identified as sellers on the day.
  • Feed grains posted small gains in light trade due to slow country movement and increased feeding programs.
  • Western barley and feed wheat experienced small commercial trades, with estimated volumes of 202 and 105 contracts, respectively.

Statistics:

  • Approximately 5,141 contracts traded at the WCE on Tuesday.
  • 1,657 contracts traded on the previous Friday.
  • The Canadian dollar declined, making US corn imports more expensive.
  • 202 contracts traded in western barley, down from 229 contracts on the previous Friday.
  • 105 contracts traded in feed wheat, up from 68 contracts on the previous Friday.
  • The price of canola futures fell to new contract lows.

Sources:

  • Resource News International
  • COMTEX (http://www.comtexnews.com)