WCE grain/oilseed review: canola mixed, old crop up on slow farmer selling

Winnipeg Commodity Exchange (WCE) grain and oilseed
futures closed Monday’s session mixed with the old crop higher lifted by the sluggish
pace to farmer selling, brokers said. New crop canola was lower.

Monday was the first day of the extended trading hours for the WCE as it opened at
8:00 PM CT Sunday evening and closed at 1:15 PM CT Monday. It was also the first day
for the exchange to utilize the ICE electronic trading platform, rather than the platform at
the Chicago Board of Trade.

Canola saw a moderate trade with the intermonth spreading accounting for the bulk
of the volume. The spreading was comprised of commercial and commodity fund activity.
Traders felt that the markets were starting to move into the seasonal quieter Xmas holiday
pattern.

The total canola volume was estimated at 16,512 contracts, down from Friday’s
18,l62 contracts, including an estimated 13,770 contracts that were involved in the spread
trade.

Canola closed mixed with prices mainly higher setting fresh contract highs in the old
crop during the session. New crop futures were mostly lower. The firm tone in CBOT
soyoil gave support as did the sluggish selling pace from farmers. Bullish technical signals
and the weak Canadian dollar also gave support.

Cash dealers feel farmer selling has slowed as the farmers concentrate on the
upcoming traditional Xmas season. They also noted that producers have become bullish,
expecting higher prices in the new year, and that has also encouraged a slower selling
pace.

Capping the gains were ideas that fresh export demand has also slowed with China
felt to be covered for the short to intermediate term. Exporters indicate that China took 5
cargoes of canola all to be delivered before Chinese New Year.

New crop futures came under pressure from ideas that canola acres will be higher in
2008.

Crushers were felt to be the best buyers with only routine exporter pricing noted.
The selling was felt to be coming mainly from commercials with elevator company scale
up hedging evident.

Western barley mixed in light trade. Commercials dominated the activity with
friendly technical signals, slow farmer pricing and the weak dollar, which makes US corn
imports more expensive, also supportive. However sluggish fresh end user demand
allowed some futures to fall, brokers said.

The total barley volume was estimated at 219 contracts, up from Friday’s 211
contracts.

Feed wheat finished a bit firmer in light trade. Traders felt the small activity
reflected liquidation trade as the total volume was estimated at 11 contracts, up from no
volume on Friday.