By Glen Hallick, MarketsFarm
WINNIPEG, Dec. 31 (MarketsFarm) – ICE Futures canola contracts were weaker at midday Tuesday, giving up most of the gains made yesterday.
“Today we are being dominated by year-end trading,” said a Winnipeg-based trader, noting there was a lot of profit-taking in Chicago soyoil, which had some effect on canola prices.
“The soyoil/canola spreaders are likely doing some year-end liquidating. They’re making some big, big profits,” he stated.
Another factor was the announcement from United States President Donald Trump regarding the Phase One trade agreement with China. Trump tweeted Tuesday morning that Phase One will be signed on Jan. 15 at the White House.
Read Also
North American Grain and Oilseed Review: Canola clings to small upticks
By Glen Hallick, MarketsFarm Glacier Farm Media MarketsFarm – Intercontinental Exchange canola futures closed a pinch higher on Friday, after…
The trader said there was skepticism towards the deal in the commodities markets for two reasons. One being China won’t divulge any detail of the trade pact until after it’s signed. The second, that Vice-Premier Lui He, China’s top trade negotiator, will sign for his country rather than President Xi Jinping.
“The markets are probably looking at that and going ‘hmmm,’” he commented.
The trader added that the deal likely won’t impact soybeans that much, but “would shift buying to the U.S. temporarily” and create large surpluses.
He said the Canadian dollar was strong on Tuesday because the U.S. dollar has a history of slipping at the end of year against other currencies, including the loonie.
So far today the Canadian dollar climbed to 77.09 U.S. cents compared to Monday’s close of 76.58 U.S. cents.
Approximately 5,800 canola contracts were traded as of 10:40 CST.
Prices in Canadian dollars per metric tonne at 10:40 CST:
Price Change
Canola Mar 475.90 dn 3.30
May 484.90 dn 3.30
Jul 490.80 dn 3.20
Nov 492.70 dn 4.90
