ICE Canola Futures Up As USDA Tightens Soybean Stocks

The USDA on Wednesday cut its grain harvest and supply estimates more than expected in crop reports.

The USDA reduced forecasts for how much corn and soybeans would be left at the end of the crops’ marketing years on August 31.

Canola reacted to the bullish USDA numbers immediately, and on the higher calls for CBOT soybean values with the start of the North American day session.

Canola values were also bolstered by the triggering of buy stop orders, as values ploughed through psychological resistance at C$600 per metric ton, brokers said.

The continued absence of farmer selling and steady demand from the domestic sector helped to influence some of the upward price action in canola. The pricing of routine export business was also supportive for canola.

Additional strength in canola was also associated with the advances seen in global crude oil futures and continued worries about the condition of the Argentine soybean crop, traders said.

The upside in canola was restricted in part by the upswing in the value of the Canadian dollar to two and a half year highs against the US dollar early Wednesday, brokers said. Firmness in the Canadian dollar was sidelining fresh export demand for Canadian canola, traders said.

As of 9:31 EST, there were 6,716 canola contracts traded.

As of 9:31 EST, no western barley contracts had been traded.