March 28, 2008

Canada rapeseed falls on weak US soy

Grain and oilseed futures at ICE Futures Canada closed Thursday session with rapeseed lower on the weak tone in Chicago Board of Trade soy futures, brokers said.

Rapeseed saw a moderate trade with much of the activity comprised of inter-month spreading.

Light index fund rolling of May contracts into July was noted with the bulk of the spreading comprised of commercial activity. Index fund spreading is expected to be heavy on Friday and Monday.

Rapeseed volume was estimated at 11,557 contracts, down from Wednesday's 13,730 contracts, including an estimated 8,180 contracts involved in the spread trade.

Rapeseed was lower in the overnight session in the wake of losses in vegetable oil prices. It continued to be pressured in the North American trading session as weakness in CBOT soy futures weighed on the market. Rapeseed finished moderately lower.

Besides the weakness in CBOT soy, the firm Canadian dollar, the lack of fresh exports and profit-taking following the recent run-up in rapeseed prices contributed to the weak tone.

Traders did note that price movement was exaggerated in the thin outright volumes as they described activity as whippy and choppy.

Trading volumes have slowed as participants want to be sidelined ahead of Monday's USDA planting report. The extreme volatility of rapeseed in the past month also has limited the interest in rapeseed trading.