Lentils Unchanged to Weaker

VANCOUVER - May 29/10 - SNS -- International lentil markets finished the week's trading unchanged to weaker, with buyers in many parts of the world reluctant to cover more than short term needs.

The main issue facing importers, especially in Europe, is unusual volatility in world currencies. This was cited as a key problem facing Canadian agricultural exporters by the Canadian Wheat Board (CWB) in its latest update on market conditions.

"Outside factors remain critical to agricultural commodity price determination. The general macro-economic climate is characterized by a lack of confidence, unease and volatility. Greek financial issues have proven significant, revealing structural weaknesses across the European Union (EU) financial sector. In a globally integrated economy, problems within the EU quickly become problems across the broader market. Crude oil has fallen $15 per barrel since last month, a clear indication that demand remains restrained by economic realities," the CWB said.

"The fear of contagion from the Greek debt crisis and Asian geopolitical unrest are contributing to the risk aversion that has weakened the Canadian dollar over the last few weeks," the CWB explained.

"Foreign-exchange rates continue to be highly volatile, as currencies fluctuate with global-risk appetite. The Canadian dollar is no exception, trading as high as parity with the U.S. dollar and as low as 92 cents US (1.0850) in May. Going forward, currency relationships will be a critical factor. . . ."