ICE Canada Review: Canola Higher As Selling Dries Up

While overbought price sentiment did lead to some early profit-taking in canola, the path of least resistance remained pointed higher in the most active contacts on Wednesday.

CBOT soybeans were also chopping around on Wednesday, but held onto advances in most months late in the session, which provided some spillover support for canola, according to traders.

Routine exporter and domestic crusher pricing also underpinned the canola market, according to canola traders. The domestic crush continues to move forward at a record pace, while global demand for vegetable oil is also strong.

Bullish technical signals were another supportive factor for canola, with the fresh contract highs hit in some months encouraging additional chart-based buying.

Uncertainty ahead of next week’s USDA supply/demand report kept activity in the canola market on the choppy side, said traders.

The Canadian dollar was trading within a narrow range on Wednesday, providing little direction for canola.

About 9,418 contracts traded on Wednesday, which compares with Tuesday when an estimated 8,840 contracts changed hands. Spreading accounted for about 2,616 of the contracts traded.

Western barley futures were steady to lower on Wednesday, with five contracts traded at the close of the session.

Settlement prices are in Canadian dollars per metric ton.