WHEAT is still the king crop among Canada's farmers, but you wouldn't know it here on the floor of the Winnipeg Commodity Exchange, where all the action is in the canola futures pit.
About 60 traders, most wearing company-identifying multicolored jackets, are furiously marking fistfuls of trading slips while glancing furtively at a large digital board listing canola contract prices by month.
The relative quiet is deceptive. Trading is open, but few traders are active, despite the fact that there is just one minute left in the trading day. Some traders pace nervously, apparently trying to figure out their strategy. Only a few venture bids or offers.
``Hey! Sell August,'' a yellow-coated trader bellows. But his colleagues act as though they haven't even heard him. Nobody responds. After five or 10 seconds, another trader belts out: ``Three bucks for August 24 puts!'' He, too, is ignored.
All eyes are on the digital clock as it counts down to 1:14:30 p.m., when three quick bells sound, and there is a sudden explosion of noise and action. Grown men leap up and down and bounce against one another, waving their trading slips and shouting at the top of their lungs. Thirty seconds later, another bell rings and it is over.
The tension now broken, some traders smile, while others glare at the slips in their fists - the mood is not unlike a locker room after a football game. One trader wearing the jacket of Midland Walwyn, a large grain trading company, is laughing as he turns to a friend: ``All of a sudden I felt this jolt, and my teeth....''
One reason why canola is traded with such vigor here in the closing seconds is that players on the exchange - international grain traders, merchants, exporters, oil-seed crushers, and others - know that they will make grain purchases or sales ``overnight'' in the exchange's off hours.
Many, however, want to buy a contract for delivery of canola in the future at the price set that day. Locking in today's price to minimize the impact of fluctuations is called a ``hedge.''
It works like this: You own a hog, which you plan to sell in two months. Somebody has said they will buy it then for $400. The price of pork may be higher 60 days from now, but it may also be lower. To capture your profit, you agree to that price. That contract would be called a ``futures'' contract if it was bought or sold through a commodity exchange.