ICE Canada Review: Outside oilseed gains bolster canola

Canola found early support from the new contract highs that were established in Malaysian palm oil and European rapeseed futures in overnight activity, brokers said.

Strong gains in both CBOT soybean and soyoil futures during the North American day session also sparked some good buying interest in canola, traders said.

Adding to the upward price momentum in canola was strong domestic processor demand and the continued pricing of old and new export business, brokers said.

Some of the buying in canola came from the speculative fund sector, who were looking to trigger buy-stop orders that were believed to be sitting just above technical resistance levels, traders said.

The upward price action in canola was restricted by scale up elevator company hedge selling and by profit-taking by a variety of market outlets. The upswing in the value of the Canadian dollar was also a factor limiting the price gains.

The gains in canola were also offset by some speculative liquidation of long positions ahead of the Christmas and New Year holidays.

Spreading was a big part of the volume total seen in canola.

There were an estimated 19,555 canola contracts traded Monday, up from the 17,150 contracts that changed hands during the previous session. Of the contracts traded Monday, 14,324 were spread related.

Western barley futures were unchanged and untraded Monday. On Friday, no western barley contracts changed hands.