ICE Canada Review: Canola Rallies with Fund Buying

After being the primary reason for canola’s four session long losing streak, some speculative funds were coming back into the market, brokers said, which helped canola offset losses from earlier in the day and post slight gains.

Increased demand from the domestic crushing sector provided strength to the market. CBOT soyoil values were higher, which made crush margins more favorable for participants, analysts said.

Market watchers said the pricing of old export business also underpinned values.

Gains were limited by losses in outside oilseed markets, with CBOT soybeans closing weaker, and sharp overnight declines posted by both Malaysian palm oil and European rapeseed, experts said.

Farmer selling was a popular theme in the market as well, although some producers were still holding onto stocks in hopes values will turn higher, analysts said.

Also restricting advances was the Canadian dollar, which was about two-fifths of a cent stronger on the day, market watchers said.

About 22,651 contracts were traded on Wednesday, which compares with Tuesday, when an estimated 36,596 contracts changed hands. Spreading accounted for about 15,574 of the contracts traded.

Settlement prices are in Canadian dollars per metric ton.