By Dwayne Klassen, Commodity News Service Canada

Winnipeg – October 9/12 – CNS – Canola contracts on the ICE Futures Canada platform were trading at higher levels at 10:23 CDT Tuesday morning with strength in the outside oilseed markets generating the upward price movement, industry watchers said.

Gains were posted overnight in Malaysian palm oil and European rapeseed futures. CBOT soybean and soyoil futures had also experienced some upward price action earlier in the session.

Steady domestic crusher demand helped to influence the price gains in canola as did the pricing of old export business, brokers said.

The strength in canola was also linked to concerns about the smaller than expected harvest this fall, traders said.

Some chart-based buying from a variety of market participants also helped to lift canola futures. Elevator company hedge selling was on the lighter side, which helped to underpin canola, traders said. The lack of hedges reflected the reluctance of farmers to deliver canola to the cash pipeline.

A good portion of the activity in canola consisted of spreading, with participants seen rolling positions out of the November canola contract and into the January future, brokers said.

The upside in canola was restricted in part by the taking of profits at the highs of the day and the general firmness of the Canadian dollar, brokers said. The pull-back in the advances seen in CBOT soybeans and soyoil also tempered the upside in canola.

Some evening up of positions ahead of important USDA reports due out later this week was also a feature of the activity. In canola.

As of 10:23 CDT, about 7,478 canola contracts had traded. Of the contracts that exchanged hands, 4,600 were spread related.

Milling wheat, durum and barley contracts were unchanged and untraded.

Prices in Canadian dollars per metric ton at 10:23 CDT: