By Dwayne Klassen, Commodity News Service Canada

Winnipeg – Canola contracts on the ICE Futures Canada platform were trading at lower price levels at 09:26 EDT Tuesday morning with the taking of profits after recent advances and overbought price sentiment generating the downward price slide, market watchers said.

The liquidation of positions ahead of Wednesday’s latest round of supply/demand balance sheets from the USDA was also evident and helped to weight on canola.

The weaker tone in CBOT soybean and soyoil futures as well as overseas oilseeds, further weighed on canola values, brokers said.

Some chart based liquidation as a number of canola contracts have hit overhead technical resistance levels, also added to some of the bearish sentiment in the commodity, traders said.

The downside in canola was seen as restricted given that US weather outlooks remain overall supportive to grain markets, brokers said. With soybean production potential already reduced to the point where the market must start to ration usage, which is already happening. China continues to

front-end load their buying, worried about supplies mid-winter.

Meanwhile, weather forecasts are calling for intense heat patterns in southern Saskatchewan and Manitoba with temperatures this week pushing towards the mid 30’s (Celsius) which could put certain crops in some jeopardy, analysts said.

Saskatchewan’s Cropping Management Specialist Grant McLean says while crops need the sunshine, intense heat could cause some stress on the crops.

As of 9:26 EDT, there were 1,287 canola contracts traded.

As of 9:26 EDT, there were no milling wheat, durum or barley contracts traded.

Prices in Canadian dollars per metric ton at 9:26 EDT: