ICE Canola Narrowly Mixed In Heavy Trade

Canola volumes were heavy with much of the activity intermonth spreading as participants rolled their July contracts into the Nov contract. Evening up was also evident ahead of the Victoria Day long weekend that will see the ICE Canada market closed on Monday when the normally dominant Chicago Board of Trade will be open.

The total canola volume was estimated at 22,315 contracts, up from 13,676 contracts on Thursday.

Canola was a bit higher in the overnight trading session, prompted by strength in overnight US soy complex values. Canola held onto its gains as the North American trading session opened and the CBOT soy complex opened mixed and then turned lower. Canola was firm for most of the day ending narrowly mixed with the tone firm.

Canola was supported by strong exporter pricing of old export sales and a weak Canadian dollar. Friendly technical signals and unaggresive selling contributed to the gains as canola outperformed the US soy complex. A shift in weather forecasts to cooler and wetter for western Canada for next week was also supportive as it will hamper canola planting.

Trade sources have indicated that the next two week are critical for canola planting. "Problems (in planting) up until now have not been too significant, but planting has to be completed by the end of the month, otherwise yields will be affected", said one grain trade source.

Weighing on the market was the steep slide in CBOT soy complex values, the slowing pace to fresh export demand, eroding crush margins and evening up ahead of the long weekend, analysts said.

Exporters were the strongest buyers with only light crusher interest noted. Speculative buying was evident as commodity funds bought between 1,000 and 1,500 July contracts. The selling comprised of exporter liquidation, commission house profit taking and light elevator company offerings.

Western barley ended a bit higher in light commercial trade. The market was pressured down by weakness in CBOT corn and the lack of end user demand. However farmer selling was "non-existent", said brokers, and that lifted the market to small gains in the thin volumes.

The total barley volume was estimated at 142 contracts, up from just 3 contracts on Thursday.

Prices are in Canadian dollars per metric ton: