By Phil Franz-Warkentin, Commodity News Service Canada
WINNIPEG, June 7 (CNS Canada) – Canola contracts on the ICE Futures Canada platform were down at midday Tuesday, taking some direction from the losses in Chicago Board of Trade soyoil.
A firmer tone in the Canadian dollar, which has gained roughly two cents relative to its US counterpart over the past week, contributed to declines in canola. The stronger currency makes exports less attractive to international buyers.
Relatively favourable crop conditions across most of Western Canada also weighed on values. However, the need to keep some weather premiums in the futures limited the losses as there is still a long growing season ahead, said a broker.
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Canola was also underpinned by ideas that the Canadian oilseed is underpriced compared to other options. A broker pointed out that while crush margins were down by C$12 per tonne, the futures had only lost C$2 at midday.
“Canola is a little bit on the cheap side, which is insulating it to the downside,” said the broker.
About 14,500 canola contracts had traded as of 10:54 CDT. The July/November spread trade was a feature of the activity, as participants were busy rolling positions out of the front month.
Milling wheat, durum, and barley futures were all untraded and unchanged.
