ICE Canola Moves Higher With CBOT Soybeans

Canola prices had been narrowly mixed in early activity but firmed in response to the gains seen in Chicago soybeans, brokers said.

Tuesday morning’s neutral Statistics Canada 2009 canola acreage estimate also allowed prices to move off their lows although the report’s overall market impact was limited, traders said. The report pegged canola acreage in western Canada at 15.825 million acres, which was down from last year’s 16.159 million but in line with pre-report expectations.

The firm overnight tone in vegetable oil markets provided additional support.

Uncertainty about weather and the development of the Canadian canola crop was seen providing a floor for canola as well. Dry areas of Saskatchewan received much-needed precipitation in recent days but there are doubts as to whether the moisture arrived too late for the driest fields. Drought areas in Alberta missed out almost entirely on the weekend rainfall.

Outside markets failed to provide clear direction to canola, market watchers said. The Canadian dollar was slightly weaker, equities posted minor losses and crude oil were trading just above unchanged.

Activity in the canola market was on the light side, with only 3,193 contracts traded as of 11:02 CDT. Of that amount, 1,362 trades were spread-related.

Western barley futures were unchanged to lower although the market was very thinly traded. Only 5 contracts had changed hands as of 11:02 CDT.

Statistics Canada pegged barley acreage in western Canada at 8.778 million acres, which was on the low end of trade expectations.

Prices in Canadian dollars per metric ton at 11:02 CDT: