ICE Canola Contracts Strengthen On Export Ideas

Canola values had initially moved slightly lower early Wednesday reacting to an upswing in the value of the Canadian dollar and to the losses seen overnight in the overseas vegetable oil prices, brokers said. The lower calls for CBOT soybean and soyoil values with the start of the North American day session had also stimulated some early weakness in canola.

However, canola futures began to move up as commercial buying interest picked up. Some of that buying interest was said to be covering fresh export sales of Canadian canola to an unspecified destination. Earlier this week speculation circulated that Canadian canola oil export business had also been concluded.

A slow down in the level of hedge selling by line companies also allowed canola futures to move to higher ground, analysts said. Some underlying support in canola also continued to stem from the dryness concerns in the soybean growing areas of Argentina.

Much of the early volume total in canola consisted of spreading, brokers said. Some position evening ahead of Friday’s latest round of supply/demand reports was also a feature of the activity.

The upside in canola was being tempered by the losses seen in CBOT soyoil futures and the start of year-end liquidation orders by fund accounts, brokers said.

There were an estimated 13,104 canola contracts traded at 10:31 CST. Of the contracts traded, 10,122 were spread related.

There were no western barley futures traded as of 10:31 CST.