ICE Canola Down On Improved Weather, Profit-Taking

Calls for a lower start in the CBOT soy complex, due to improved crop ratings for the US soybean crop, were expected to spill over to weigh on canola, according to traders. A broker noted that western Canadian crop conditions were also benefitting from some improved weather forecasts, with some of the wet areas finally starting to dry out.

However, there is still plenty of concern regarding Canada’s canola crop and the yield potential this year. The uncertain production prospects were keeping farmer selling to the sidelines, while providing some solid underlying support to the canola market, according to traders. Concerns about the European rapeseed crop, due to hot, dry conditions there, should also continue to underpin canola.

While canola prices did run into some technical resistance on Monday, an analyst said the overall bias remained to the upside, with any declines likely seen as buying opportunities.

The Canadian dollar was relatively unchanged Tuesday morning, but could eventually provide some direction for canola as currency traders await the latest interest rate announcement from the Bank of Canada.

About 480 canola contracts had traded as of 8:20 CDT.

Western barley futures were untraded and unchanged.

Prices in Canadian dollars per metric ton at 8:20 CDT: