ICE Canola Firm On Export Demand

The canola volume was heavy with intermonth spreading accounting for much of the activity as commodity funds were buying the spread and commercials were mainly selling the spread.

The total canola volume was estimated at 18,817 contracts, up from Tuesday’s 14,298 contracts, including an estimated 15,972 contracts involved in the spread trade.

Canola was higher in the overnight trading session prompted by the gains in international vegetable oil prices. Canola held onto its small gains as the North American trading session got underway and Chicago Board of Trade soybean futures posted stronger than expected advances. Canola gains were eroded thorough the session and the market ended mainly a bit higher.

Canola was supported by the continued weather delays in harvesting crops in northern Saskatchewan and the strong export program, as another 500,000 metric tons of canola are scheduled to move by the end of the month. Continued expectations for China to be in the market for canola this week also gave support. The late rally in CBOT soybean futures also lifted the market in the very choppy trade at the close. Farmer selling accelerated, but was still considered light and that help to keep the market in the plus column.

Weighing on the market was the very strong Canadian dollar and increased elevator company selling. Also pressuring prices was very strong technical resistance at the $390 level in the Nov contract.

Japanese pricing was augmented by crusher and exporter buying with commodity fund buying noted in the Jan contract. The selling came from elevator company offerings and speculative selling prompted by the strong Canadian dollar, traders said.

Western barley ended a bit lower in moderate trade. Ideas that more grain will grade as feed, due to the inclement weather, weighed on values, brokers said. End user buying met commercial selling.

The total barley volume was estimated at 569 contracts, up from 141 contracts on Tuesday, including an estimated 270 contracts involved in the spread trade.

Prices are in Canadian dollars per metric ton: