ICE Canola Falls With US Soy

Canola saw a moderate trade with intermonth spreading accounting for much of the volume. The spread trade was mainly commercial, said traders.

The total volume was estimated at 13,499 contracts, down from Wednesday’s 18,817 contracts, including an estimated 9,396 contracts involved in the spread trade.

Canola was lower in the overnight trade, prompted by a weak tone in international vegetable oil prices. Canola continued to see losses as the North American trading session got underway and the US soy complex posted declines. Canola finished the session lower.

Canola was pressured down by the weakness in CBOT soybean futures and better weather forecast for the stalled harvest area in northern Saskatchewan. Also weighing on the market was slow demand as export buying is felt to be C$20/metric ton below current market prices. Ideas the market was due for a technical correction also prompted some selling.

However, canola did not see as large losses as the US soybean market prompted by
improved crush margins prompted by the rally in CBOT soyoil. The weak Canadian dollar also gave support as did slow farmer selling. Cash dealers are indicating that farmers are waiting for the traditional post harvest rally before delivering now. A strong export program through the end of the month has cash market basis levels very firm and that is also giving support. The very strong crude oil market was also felt to be supportive.

Crushers were the best buyers with only routine export pricing noted. The selling is mainly commercial.
Speculators were generally sidelined today, except for some light local participation, said brokers.

Western barley ended a bit higher in very light commercial trade. The lack of country movement forced prices higher in the very thin volumes and lackluster activity, brokers said.

The total barley volume was estimated 100 contracts, down from Wednesday’s 619 contracts.

Prices are in Canadian dollars per metric ton: