MarketsFarm — ICE Futures canola contracts were stronger on Wednesday, making up losses incurred earlier in the week.
The nearby January contract closed Wednesday at $578.90 per tonne, gaining a few dollars after losing $7 in the prior day’s trade.
Keith Ferley of RBC Dominion Securities in Winnipeg said canola’s losses were due to chart consolidation and profit-taking ahead of the U.S. Thanksgiving holiday. U.S. markets are expected to be subdued for the rest of the week.
“It’s not a bad thing for markets to pull back, regroup, and stabilize,” Ferley said.
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After falling Tuesday, markets regained some ground at midweek, due in part to strength in comparable vegetable oils. January Chicago soyoil was up by about a 10th of a cent on Wednesday, closing at 37.86 U.S. cents/lb.
Gains in the Canadian dollar have been a limiting factor for canola prices, as strength in global crude oil values supported the energy-sensitive currency.
The dollar closed Wednesday at just under 77 U.S. cents, near its highest levels in two weeks.
Market participants are optimistic a COVID-19 vaccine could improve crude oil demand, while weekly data from the U.S. Energy Information Administration showed tighter-than-expected oil supplies in the U.S.
— Marlo Glass reports for MarketsFarm from Winnipeg.
