ICE Canola Bias Lower On Active Harvest

Canola saw a moderate trade with an estimated 2,072 contracts traded as of 08:29 CDT.

Canola spent the bulk of the overnight session lower in response to weakness in e-cbot soybeans and modest declines in European rapeseed.
Prices did move to small gains ahead of the openeing of the North American session when light buying could uncover no selling and that took the Nov contract briefly as high as C$400. Canola is expected to see a choppy session with prices generally weaker ahead of the weekend.

Weighing on the market is the expected decline in Chicago Board of Trade soybean futures when they open and weakness in crude oil. Expected advances in the harvest on the weekend, with weather favourable into the beginning of next week, will also pressure the market, traders said.

Cash dealers said they expect to see elevator company selling pick up during the session as they prepare for increased farmer deliveries on the weekend. Farmers’ reports coming in from the harvest generally highlight unexpectedly strong yields.
This has prompted some analysts to revise their production estimates as high as 11 mln metric tons, compared to the last Statistics Canada estimate of 9.5 mln tons

Traders have noted some increase though in export interest this week and that is underpinning the market as are ideas that canola is due for a rebound. Technical traders feel that the canola market performance this week suggests that it is putting in its lows. There are still some forecasts for frost next week in western Canada.
However only a small amount of the canola crop is vulnerable, and traders don’t consider it significant.

Commercials have dominated the trade so far with export and crusher interest noted.

Western barley was untraded and unchanged in overnight trade.
End user demand remains under the market.

Prices at 08:38 CDT in Canadian dollars per metric ton: