ICE Canola Contracts Up On Weather/Outside Oilseeds

Canola futures were supported early in the session by the new contract highs established in European rapeseed futures overnight. Gains in Malaysian palm oil futures also helped to influence some early buying interest, brokers said.

Strength in canola was also coming from the advances posted by CBOT soybean and soyoil futures.

Gains in canola were also coming from the drought reduced European rapeseed crop and the need to keep a weather premiums in canola given the uncertain weather situation in western Canada. Some market participants felt that conditions for the development of the canola crop in western Canada has improved recently, but others felt it was still too soon to make any conclusions.

Steady domestic crusher demand helped to buoy canola futures as did the pricing of old export business to Japan, traders said. Rumors of Mexican demand for Canadian canola continue to circulate, but confirmation continues to be lacking.

The upside in canola was being limited by technical resistance and by profit-taking. Steady hedge selling by grain companies, as producers remain good sellers of canola into the cash pipeline, also restricted the price advances, brokers said.

Firmness in the Canadian dollar was also an undermining price influence.

There were an estimated 3,235 canola contracts traded at 10:25 CDT.

There were no western barley futures traded as of 10:25 CDT.