ICE Canola Lifted By Weather

Canola activity was moderate with intermonth spreading contributing to the volumes as commercials dominated the trade. Commercials were rolling their July contracts forward, paring down their position to meet exchange imposed position limits.

The total canola volume was estimated at 8,997 contracts, up from Tuesday’s 5,812 contracts, including an estimated 4,112
contracts involved in the spread volumes.

Canola was narrowly mixed through the overnight session as weakness in international vegetable oil prices was offset by canola production uncertainties in western Canada in extremely thin activity. Canola posted small gains as the North American trading session opened.
Activity through the Wednesday session was very choppy with prices bouncing to both sides of Tuesday’s close. Values ended mainly a bit higher in the two actively traded contracts.

Canola drew much of its support from the uncertainties surrounding the canola crop as a result of the dryness concerns on the western prairies, brokers said. Weather outlooks for the driest areas contain only limited moisture. Alberta Agriculture in its latest crop report, dated June 18,
said that moisture conditions were poor in about 50% of the growing areas.

The firm tone in the Chicago Board of Trade soybean futures were only a minor support as they were balanced off by the weakness in CBOT soyoil, they added. Slow farmer selling contributed to the gains as did the continued strong export line up over the next 4 weeks.

Weighing on the market was liquidation selling by commercials, eroding crush margins and the firm tone in the Canadian dollar.
Fresh export bookings are still lacking in the new crop as participants assess the canola production levels.

Routine exporter and crusher pricing met mainly commercial selling.

Western barley ended mostly higher in a light trade that was focused mainly in the newly revised barley contracts.
The firm tone reflected ideas that production will drop sharply due to lower acres and yields this year. However, talk among cash traders that US corn prices were approaching attractive levels for shipment into southern Alberta maintained pressure on the market.

The total barley volume was estimated at 208 contracts, up from Tuesday’s 119 contracts.

Prices are in Canadian dollars per metric ton: