ICE Canola Lower In Very Thin Overnight Activity

Although e-CBOT soybeans eventually recovered to narrowly mixed levels, early double-digit losses helped to undermine canola values in overnight activity.

Further weighing down prices was slow buying interest and a a lack of firm overnight direction from outside markets. Although both markets have since firmed, crude oil futures were lower overnight while equity markets were mainly flat and thinly traded to due May Day holidays in Europe, analysts said.

Also contributing to the market’s weakness, traders said, was the continued strength of the Canadian dollar, which in early activity was trading at over 84 US cents.

Minor support was tied to steady to slightly higher opening calls for Chicago soybeans as well as gains overnight in Chinese rapeseed and Malaysian palm oil futures, analysts said.

Brokers expect canola volumes to be on the light side ahead of the weekend and due to May Day holidays and that could cause choppiness in canola unless clear price signals are provided to the market.

Profit-taking and ideas that North American oilseed markets need to consolidate after a week of large price swings may keep a lid on the upside potential in Chicago soybeans and canola, traders said.

However, weather-related concerns, friendly chart signals, tight US soybean supplies and Argentina’s small soybean harvest will provide underlying support to canola contracts.

As of 9:05 CDT, only 365 canola contracts had been traded.

There were no western barley contracts traded as of 9:05 CDT.

Prices in Canadian dollars per metric ton at 9:05 CDT: