ICE Canada Review: Canola Follows Soybeans Higher

Gains in the CBOT soy complex were spilling over to pull canola higher as well on Tuesday, according to traders. However, the buying interest in the Canadian market was more subdued, and profit-taking also limited the upside.

The fact that canola was looking cheaper compared to soybeans resulted in some end user pricing, although traders said there was no significant fresh buying interest coming forward.

Speculators were some of the noted participants in the canola trade, according to a trader who said the funds were generally bullish and were looking for any reason to add to their long positions.

A lack of farmer selling also provided some underlying support for canola, as most growers are expecting to see higher prices in the New Year and are moving to the sidelines for the time being, according to traders.

About 27,809 contracts were traded on Tuesday, which compares with Monday when an estimated 28,221 contracts changed hands. Spreading was a feature, accounting for 22,720 of the contracts traded. Activity is expected to turn thin and choppy over the next week, and the lighter volumes during the Christmas/ New Year’s period were resulting in a more cautious tone in the market, according to participants.

Western barley futures were untraded and unchanged.

Settlement prices are in Canadian dollars per metric ton.