By Phil Franz-Warkentin, Commodity News Service Canada
WINNIPEG, June 16 (CNS Canada) – Canola contracts on the ICE Futures Canada platform were sharply weaker at midday Thursday, as fund long-liquidation and farmer-hedges weighed on values.
Sharp losses in the Chicago Board of Trade soy complex put spillover pressure on canola, providing the catalyst for the declines as overbought sentiment had speculators on both sides of the border on the sell side, according to a broker.
“The markets have been looking toppy for awhile,” said a trader accounting for Thursday’s selloff. “There is room to flush some money out if the weather stays reasonable for a week or two,” he added.
While weather conditions are relatively favourable across both Canada and the US, the trader noted that there was still a long growing season ahead with any potential issues likely to limit the downside.
Scale-down commercial demand helped limit losses. A weaker tone in the Canadian dollar was also supportive.
About 21,000 canola contracts had traded as of 10:35 CDT.
Milling wheat, durum, and barley futures were all untraded and unchanged.
