ICE Canola Falls On Weak US Soy

Canola saw a moderate trade with intermonth spreading very light.

The total canola volume was estimated at 7,757 contracts, up from Monday’s 3,777 contracts, including an estimated 786 contracts involved in the spread trade.

Canola futures were lower in the overnight market in reaction to the weak tone in international vegetable oil prices. Canola firmed shortly after the opening of the North American trading session as CBOT soybeans moved higher. Canola traded to both sides of Monday’s close during the day, ending lower.

Canola was mainly pressured down by the weak tone in CBOT soybeans and soyoil.
Favourable growing conditions forecast for the next week also weighed on prices. "Everyday we get no significant frost is a day closer to getting this crop off," said a trader. Fresh export demand remains sluggish and that also prompted some of the weakness.

Giving support was improved crush margins, the weak Canadian dollar and slow farmer selling. The market also needed to maintain a weather premium due to the continued threat from frost, analysts said.

Crushers were good buyers with only routine exporter pricing noted.
Commodity funds were noted on both sides of the market with some commission house selling also evident in the trade. Commercials were also sellers.

Western barley ended a bit lower in light trade. The weak tone in CBOT corn pressured the market down as did the overall bearish feed grain outlook, brokers said.

News that the Rogers Commodity Index was removing barley from its index because of poor liquidity was felt to have little impact on today’s trade. Longer term, though, it was felt to be negative as it removed liquidity from the market, brokers said.

The total barley volume was estimated at 132 contracts, down from 311 contracts on Monday.

Prices are in Canadian dollars per metric ton: