Futures and Commodity Market News

Mon May 12, 2008

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WINNIPEG, MB, May 09, 2008 (Resource News International via COMTEX) -- Canola contracts on ICE Futures Canada finished the session on a sharply firmer footing with a bullish US soybean ending stocks forecast and a pick up in demand stimulating the upward price climb, market watchers said. Position evening ahead of the weekend was a feature of the activity.

Commission houses and commercials were some of the featured buyers of canola during the session. Some of the buying was sparked by the sharp gains seen in CBOT soybean and soyoil values, brokers said. Gains overnight in Malaysian palm oil and Matif rapeseed values had also propped up canola prices.

Reports that Japanese interests were again pricing Canadian canola export business helped to fuel the upward price action, traders said.

Domestic crushers were also good buyers during the session which aided the advances. The absence of any significant hedge offers contributed to the strength. Brokers noted that producers were now concentrating on spring seeding operations and it was likely that producers deliveries would remain light over the next couple of weeks.

Helping to underpin canola futures was the need to build a weather premium into prices. Strength in the energy markets also provided some support to the oilseed markets in general.

The advances in canola were tempered by profit-taking at the highs for the day. Strength in the Canadian dollar further limited the upward price climb, brokers said.

There were an estimated 13,069 canola contracts traded during Friday's session, up from 9,042 during the previous session. Of the contracts traded, 8,634 were spread related.

Western barley futures were steady to higher in choppy activity. Strength in CBOT corn futures helped to encourage some of the upward price action seen in barley, traders said. However, the absence of fresh end-user demand limited the price advances. Activity was a light two sided commercial affair.

An estimated 232 barley contracts changed hands during the session. On Thursday, 459 contracts were traded.

Prices are in Canadian dollars per metric ton.

                   Settlement
                   Prices           Change
Canola             Jly 634.20       up 22.80
                   Nov 653.40       up 25.30
                   Jan 662.90       up 25.10
Western Barley     Jly 249.40       up 1.50
                   Oct 258.40       up 1.40
     Spread trade prices are in Can dollars and the volume
represents the number of spreads:
Month             Price               Volume
Canola
Jly/Nov         15.20-19.40            4,112
Jly/Jan         25.00-29.40               22
Nov/Jan         8.70-10.40               109
Nov/Mar         19.70                      1
Nov/May         20.60-26.00               10
Jan/Mar         6.10-7.30                 34
Mar/May         5.70-6.20                 22
May09/Jly09     2.00-4.00                 27
Barley
Jly/Oct         5.10-9.00                 41

Dwayne Klassen, Resource News International

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