By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Dec. 13 (CNS Canada) – ICE Futures Canada canola contracts were mostly lower on Wednesday, as bearish technical signals and fund selling weighed on prices.
Losses in Chicago Board of Trade soyoil and Malaysian palm oil, along with a firmer tone in the Canadian dollar, contributed to the declines in canola, according to participants.
The nearby January contract moved below the psychological C$500 per tonne level, but managed to find some support to finish off its lows for the session.
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Oversold price sentiment, end-user bargain hunting, and advances in CBOT soybeans were also supportive.
About 28,662 canola contracts traded on Wednesday, which compares with Tuesday when 33,781 contracts changed hands. Spreading accounted for 21,554 of the contracts traded.
Soybean futures at the Chicago Board of Trade were stronger on Wednesday, with oversold price sentiment and light speculative positioning accounting for most of the buying interest.
However, the underlying fundamentals remain relatively bearish. While dry areas of South America remain somewhat supportive, the nearby forecasts look relatively favourable across most of Argentina and Brazil.
CBOT corn futures also posted small short-covering gains. Funds were holding rather large net short positions in corn, leaving room for some short-covering as prices sit right above chart support.
However, the improving weather forecasts out of South America also kept corn under pressure.
United States wheat futures were higher, with all three markets due for a corrective bounce after their recent losses.
End user bargain hunting at these weaker price levels was somewhat supportive, with the recent sale of 120,000 tonnes of U.S. wheat to Algeria seen as sign that values may be looking more competitive on the global market.
However, ample world wheat supplies remained a bearish influence overall.
