By Dwayne Klassen, Commodity News Service Canada Inc

Winnipeg – July 27/12 – Canola contracts on the ICE Futures Canada platform were trading at higher price levels at midday Friday. Much of the strength in canola was linked to the rally experienced by CBOT soybean and soyoil values, market watchers said.

Positioning ahead of the weekend was a small feature of the activity in canola.

Gains overnight in Malaysian palm oil and European rapeseed futures also encouraged the price advances seen in canola.

Gains in canola were also tied to steady buying interest from commodity fund accounts, traders said.

The weather issues in the US soybean belt were also contributing to the bullish sentiment in canola.

The pricing of old export business to Japan was supportive for canola, brokers said. Domestic processors were also said to have stepped up to the plate, with that interest further underpinning canola, brokers said.

The upside in canola was being restricted by steady elevator company hedge selling, as farmers in western Canada take advantage of recent strong cash bids and have been busy delivering canola into the cash pipeline, brokers said.

The taking of profits at the highs of the day also tempered the strength in canola. Firmness in the Canadian dollar was also an undermining price influence.

There were an estimated 5,265 canola contracts traded at 10:36 CDT. Of the contracts traded, 1,456 were spread related.

There were no milling wheat, barley or durum contracts traded at 10:36 CDT.

Prices in Canadian dollars per metric ton at 10:36 CDT: