By Phil Franz-Warkentin, Commodity News Service Canada
WINNIPEG, Aug. 2 (CNS Canada) – Canola contracts on the ICE Futures Canada platform were down sharply at midday Tuesday, trading right above nearby lows as losses in Chicago Board of Trade soybeans weighed on values.
Soybeans were down on Monday, while Canadian markets were closed for a civic holiday, and remained pointed lower on Tuesday. The weakness in the US was tied to improving crop conditions and relatively favourable weather forecasts across the Midwest.
Fund activity contributed to the declines in canola, with fund traders adding to their large net-short position, said a broker. A lack of significant end user demand on the other side was also bearish, as crush margins deteriorated in early activity.
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Canadian crop conditions look good overall as well, although hail and heavy rains over the weekend were seen as potentially supportive for prices.
The large fund short position, estimated at about 48,000 contracts by one broker, could also limit further losses as that position should eventually max out.
About 9,100 canola contracts had traded as of 10:54 CDT.
Milling wheat, durum, and barley futures were all untraded and unchanged.
