ICE Canada Review: Acreage Data, Exports Bolster Canola

Statistics Canada, in its first planting survey of the 2010 season, pegged canola area in Canada at a record sized 16.9 million acres. While the projection was record sized, the estimate was well below pre report expectations which had called for plantings to be as large as 17.5 million to 18.0 million acres. Canola area in Canada during the spring of 2009 totalled 16.199 million acres.

The pricing of old export sales to Japan by commercials contributed to the strength in canola, as did reports the commercials were also pricing fresh export business to either China and/or Pakistan, brokers said.

Some of the early strength displayed by canola came from the advances posted overnight in Malaysian palm oil and European rapeseed futures.

Adding to the upward price momentum in canola were the buying back of previously sold positions by a variety of market participants, brokers said.

The slow pace of farmer deliveries into the cash pipeline helped to underpin values as did ongoing concerns about dry growing conditions in western Canada this summer, traders said.

A minor pull-back in the value of the Canadian dollar was also viewed as an underpinning price influence.

The upside in canola was limited by bouts of profit-taking as well as by the large supply of oilseeds on the global market. Declines in CBOT soybean and soyoil futures also restricted the price advances seen in canola, brokers said.

Spreading was a feature of the activity in canola and helped to bolster the volume total.

There were an estimated 22,461 canola contracts traded Monday, down from 26,313 during the previous session.

Western barley futures were untraded and unchanged Monday.

No barley contracts changed hands during the session. On Friday, no barley contracts were traded.