ICE Canada Review: Canola Holds Onto Small Gains

Market participants said it was hard to get a handle on the activity in the canola market Friday, with prices seeing some wide price swings throughout the session.

While some selling pressure weighed on values early in the day, the general undertones were still very firm for canola and advances in CBOT soyoil helped provide some support, according to a broker.

Domestic crushers, exporters, and speculative funds were all noted buyers, taking advantage of the early dips in the canola market to make some purchases, said traders. The most active March contract managed to hold above the key C$600 per metric ton level, which was seen as supportive from a technical standpoint.

A lack of significant farmer selling also provided some support, with grower hedges only coming forward on a scale-up basis.

The Canadian dollar was stronger on Friday, which limited the upside in canola.

Improving prospects for the soybean crop in Argentina also accounted for some spillover weakness in canola, as forecasts are calling for more beneficial rainfall to hit the country over the next week.

About 17,357 contracts were traded on Friday, which compares with Thursday when an estimated 22,242 contracts changed hands. Spreading accounted for about 8,198 of the contracts traded.

Western barley futures were untraded and unchanged.

Settlement prices are in Canadian dollars per metric ton.