ICE Canada Review: Canola eases on late day liquidation

However, at the close, the buying that had held up canola began to fade, which allowed most contracts to soften to slightly weaker levels. Some of the late selling was believed to be profit-taking as well as a pick up in hedge offers from elevator companies, brokers said.

CBOT soybean futures also moved off their highs at the close, which contributed to the selling seen in canola, traders said.

The upside in canola was also limited by reports of harvest progress in some areas of Manitoba, Saskatchewan and northern Alberta and that canola output may not be as low as first anticipated, traders said.

Canola contracts moved upwards early in the day in reaction to the sharp gains seen in Malaysian palm oil futures overnight. The advances in canola were helped along by the upswing in CBOT soybean and soyoil values with the start of the North American day session.

The buying back of previously sold positions by a variety of market players also generated good support for canola.

Steady demand from the domestic and export sectors added to the gains seen in canola, traders said. Some of the export demand was said to be the pricing of old export business, but there were also indications that some new sales were also being put on the books.

Activity in canola was seen as light and choppy, with few market players willing to commit large positions ahead of key supply and demand reports due out later this week from the USDA.

There were an estimated 5,132 canola contracts traded Monday, down from the 9,877 contracts that changed hands during the previous session.

Western barley futures were bid higher but no contracts changed hands on Monday. On Friday, no barley contracts were traded.