ICE Canola Falls On Strong C$, Weak Soy

Canola saw a light trade with only small amounts of intermonth spreading.

The total canola volume was estimated at 4,439 contracts, up from 2,825 contracts on Tuesday, including an estimated 692 contracts involved in the spread trade.

Canola was higher in the overnight session reflecting strength in outside markets and gains in international vegetable oil prices. Canola held onto its gains as the North American trading session got underway and the Chicago Board of Trade soy complex rallied. Canola held its gains until the last 90 minutes of the session and then dropped in the wake of moderate declines in the US soybean market. Canola ended lower.

Canola was pressured down by the declines in CBOT soybeans and the very strong Canadian dollar. The dollar hit its highest level in a month against the US currency. Sluggish demand contributed to the price slide as did forecasts for better weather, traders
said.

Underpinning the market was the lack of farmer selling, the uncertainty about the crop condition and the firm tone in the CBOT soyoil markets.

Crushers were steady scale down buyers today with Japanese buying also noted. The selling came from commercials and speculators as commodity funds continued their liquidation selling. Traders estimated fund selling at about 500 Nov contracts. Exporters were also sellers.

Western barley ended lower in light commercial trade. The market was undermined by talk that US dried distiller grains were being imported into southern Alberta at a C$15/metric ton discount to local barley prices.

The total barley volume was estimated at 96 contracts, up from Tuesday’s 95 contracts.

Prices are in Canadian dollars per metric ton: