By Dwayne Klassen, Commodity News Service Canada

Winnipeg – August 30/12 – Canola futures on the ICE Canada trading platform finished mainly higher on Thursday with a pick up in demand from the domestic processing sector and a drop off in farmer deliveries into the cash system on the Canadian prairies behind some of the price strength, market watchers said.

The lower than expected yield potential from the advancing canola harvest in western Canada contributed to the advances. The price strength experienced by CBOT soybean futures also encouraged the price gains in canola, traders said.

The slow down in farmer movement of canola also came as elevator companies are encouraging deliveries especially in view of the record export program that is in place for the September through November time frame from Canada’s west coast, traders said.

Additional support in canola stemmed from the overnight advances posted by Malaysian palm oil and European rapeseed futures. A downturn in the value of the Canadian dollar Thursday was also an underpinning price influence.

Some of the buying in canola was also attributed to ideas that the commodity was undervalued in comparison to CBOT soybean futures, traders said.

The upside in canola was restricted by the taking of profits at the highs of the day. Favourable weather for the advancement of the harvest in western Canada also capped the upside price potential. Losses in CBOT soyoil values also tempered the upside in canola.

There were an estimated 12,586 canola contracts traded Thursday, down from the 19,350 contracts that changed hands during the previous session.

There were 14 milling wheat contracts traded with commercials seen as the main participants. Durum contracts were untraded but values were increased fractionally by ICE Canada. Barley contracts were untraded and unchanged.

Prices are in Canadian dollars per metric ton.