ICE Canada Review: End-User demand lifts canola

There were strong indications during the session that some fresh Canadian canola export business had been concluded with an unknown destination, brokers said. Reports that Canadian canola oil had been sold earlier in the week also continued to generate some of the support.

Adding to the upward momentum in canola was strong commercial demand, believed to be covering requirements for the domestic processing sector, traders said.

The upside in canola was also helped along by the advances exhibited by CBOT soybean and soyoil values. Only light hedge selling by line companies during the session further contributed to the gains seen in canola.

The advances in canola were also aided by the downswing in the value of the Canadian dollar and by continued concerns about the dry growing conditions in Argentina’s soybean producing region, brokers said.

Talk of tighter than anticipated US soybean supplies, which was expected to be revealed in Friday’s supply/demand report from the USDA, also provided some underlying support for canola futures, traders said.

The upside in canola was limited in part by profit-taking at the highs of the day and by end of year liquidation of long positions by speculative fund accounts, brokers said.

Good volume totals were again seen in canola Wednesday, with spreading accounting for a big portion of that activity.

There were an estimated 25,167 canola contracts traded Wednesday, up from the 17,462 contracts that changed hands during the previous session. Of the contracts traded Wednesday, 19,382 were spread related.

Western barley futures were unchanged and untraded Wednesday. On Tuesday, no western barley contracts changed hands.