ICE Canola Climbs Higher On World Vegoil Demand

Gains in both CBOT soybean oil and Malaysian palm oil provided some spillover buying interest in canola, according to a trader. He said the strong world vegetable oil demand, highlighted by increased purchases from China and good weekly US soybean sales to India, was supportive for canola.

While traders couldn’t confirm whether or not any fresh sales had occurred, they thought the large volumes in the July contract were a good sign of new business. China or Pakistan were said to be the most likely export customers.

Speculative buying was another feature in canola, according to a trader who said the charts were turning higher for the market.

Strong crush margins were also encouraging domestic processor demand, according to traders. However, gains in the Canadian dollar tempered the advances in the canola market.

Some positioning ahead of Statistics Canada’s planting intentions report, to be released April 24, was a factor in the day’s trade. Average market sentiments are for a slight increase in canola acres from the 16.159 million seeded in 2008/09, with a range from 15.75 million to 17.00 million.

As of 10:54 CDT, about 16,700 canola contracts had changed hands, with inter-month spreading a moderate feature as participants continue to exit the nearby month.

Western barley futures were higher as of 10:54 CDT, with 131 contracts traded. Spillover support from the gains in CBOT corn accounted for some of the strength in the market.

Prices in Canadian dollars per metric ton at 10:54 CDT: