ICE Canola Down On Follow-Through Selling

Thursday’s declines were bearish from a technical standpoint, as prices moved below some nearby support levels. As a result, traders thought more speculative selling could come forward in the canola market.

Calls for a weaker start in the CBOT soy complex should add to the weaker tone in canola, according to traders. Expectations for a large South American soybean crop, ongoing concerns about selling canola to China, and the firm Canadian dollar were also seen putting some pressure on the market.

While the lack of business to China remains bearish for canola, exports continue at a steady pace to other destinations. The routine export pricing should provide some underlying support for the market.

Expectations that the large index funds will start re- balancing their positions later in the session should provide some support for the US grains and oilseed futures, said an analyst. If the potential fund buying leads to a rally in Chicago, canola could also find some support, said traders.

About 1,500 canola contracts had traded as of 8:53 CST.

Western barley futures were steady to lower in overnight activity, with 35 contracts traded. Warmer weather in western Canada should reduce feed demand, while also leading to an increase in farmer deliveries.

Prices in Canadian dollars per metric ton at 8:53 CST: