CME lumber ends limit up on Canada strike, funds

CHICAGO Nov 30 (Reuters) - Chicago Mercantile Exchange lumber futures ran up the $10 per thousand board feet daily limit on Monday with most months posting contract highs sparked by a Canadian rail workers strike and fund buying.

* "We had aggressive short-covering on the CN rail strike," said Robin Cross, broker with FCStone.

* Locomotive engineers at Canadian National Railway (CNR.TO) (CNI.N), Canada's largest railroad, walked off the job on Saturday after talks broke down. [ID:nN28392589]

* Strike could slow lumber deliveries into the United States and drive up prices.

* Canadian government is ready to legislate an end to the rail workers strike because it fears the stoppage will put a fragile economic recovery at risk, a senior government official said on Sunday. [ID:nN29425005]

* But two Canadian opposition parties said on Monday they would likely oppose the government's attempt to speed through legislation to end the strike by locomotive engineers. [ID:nN30425723]

* January lumber 2LBF0 closed up the $10 per tbf daily limit at $246.20 and March 2LBH0 limit up at $265.50. January posted a 5-1/2 month higher while March through September posted contract highs.

* There were 200 unfilled buy orders in January.

* Futures are also technically strong and that is bringing in additional fund buying and short-covering.

* "You're making a run for contract highs. We filled the weekly gap and you blew out some good upside resistance and now that we are above it you are going to get continued aggressive short covering," Cross added.

* In other news, the Obama administration threatened on Monday to punish mortgage lenders with fines unless they speed up efforts to give hard-pressed homeowners a permanent break on monthly payments. [ID:nN30451859] (Reporting by Jerry Bieszk; Editing by Lisa Shumaker) ((jerry.bieszk@thomsonreuters.com; 312-408-8725; Reuters Messaging: jerry.bieszk.reuters.com@reuters.net)) ((For help: Click "Contact Us" in your desk top, click here [HELP] or call 1-800-738-8377 for Reuters Products and 1-888-463-3383 for Thomson products; For client training: training.americas@thomsonreuters.com ; +1 646-223-5546))