ICE Canada Review: Canola Nearbys Up On Short-Covering

The evening up of positions ahead of the weekend was a feature of the activity with the volume total being augmented by the rolling of positions by commodity funds out of the nearby March contract and into the May future, market watchers said.

Much of the upward price action seen in the nearby March and May contracts was associated with the buying back of previously sold positions, traders said. Support during the session also came from steady domestic processor demand and the routine pricing of old export business to Japan and Mexico by commercials.

The lack of aggressive hedge selling by elevator companies also allowed the nearby months to climb fractionally higher, brokers said.

Canola values came under early downward pressure from the losses seen overnight in Malaysian palm oil and from the declines seen in CBOT soybean and soyoil futures during the North American day session, traders said.

The lack of fresh export demand and chart related speculative liquidation also helped the deferred canola futures move lower.

Reports of beneficial rainfall in the soybean growing regions of Argentina and Brazil also sparked some selling in canola as the precipitation there was only seen increasing the size of those crops further.

An upward rebound in the value of the Canadian dollar late in the session also prompted some selling of canola.

There were an estimated 17,298 canola contracts traded Friday, down from 18,959 during the previous session. Of the contracts traded, 12,806 contracts were spread related.

Western barley futures were little changed with commercials remaining on the sidelines in the absence of fresh fundamental inputs, brokers said.

There were no barley contracts that changed hands during the session. On Thursday, 13 barley contracts were traded.