ICE Canola Posts Small Overnight Gains

Support was tied to the firm tone in outside markets. Gains in e-CBOT soybeans and Malaysian palm oil futures underpinned canola prices, as did higher global equities and crude oil futures, market watchers said.

Light buying was also encouraged by the moderately higher opening calls for soybeans once North American trade begins in Chicago.

However, the early tone in canola was mixed, with contracts having traded on both sides of unchanged.

According to a Winnipeg trader, the environment for canola has become ‘fairly difficult’ given the recent weakness in the CBOT soyoil market and the surge in the Canadian dollar. In five weeks, the Canadian currency has climbed 12 US cents, he noted.

Sluggish commercial demand, tied to easing domestic crush margins and the absence of fresh export business, is also weighing down canola values, market watchers said.

The market is further undermined by ideas that canola acres in western Canada could be higher than Statistics Canada’s April planting intentions report forecast.

Canola is supported, however, by CBOT soybeans, which are benefiting from bullish fundamentals and good technically-based speculative interest, the trader said.

Concerns about dryness in the western prairie provinces are also beneficial for prices and strength Friday in outside markets will further underpin canola.

Early volumes in canola were fairly heavy, with 2,151 contracts already having changed hands as of 9:06 CDT. Market watchers said canola volumes may be fairly high Friday as index funds roll their July positions into the November contract.

Meanwhile, western barley contracts were unchanged and untraded as of 9:06 CDT.

Prices in Canadian dollars per metric ton at 9:06 CDT: