ICE Canola Stronger Following Soybeans

While there was still no official confirmation on Monday, the talk in the trade was that China had agreed to extend the deadline on requiring canola shipments to be blackleg free. Speaking to reporters in Winnipeg, Canadian Agriculture Minister Gerry Ritz said he was hopeful the deadline would be extended or the restrictions would be lifted altogether.

A market analyst said there was a sense of comfort in the market that resolution would be found and canola would continue to move to China. The unexpected news a couple weeks ago that China would require certification on all canola shipments that they were blackleg free after November 15 had weighed heavily on canola prices, as the country is a major customer for Canada’s canola.

Commodity funds were noted buyers on Monday, according to a trader. He noted that the funds had built some fairly sizeable short positions in recent weeks and were now covering those positions.

Ongoing harvest delays in western Canada were also supportive, with traders now anticipating that production will likely be smaller than originally thought. However, improving weather forecasts should allow for some progress this week.

The Canadian dollar was stronger Monday morning, tempering the advances in canola, said traders. A stronger Canadian dollar makes the commodity more expensive to export customers and cuts into domestic crush margins.

Commission houses were noted sellers, while light commercial hedges were also finding their way to the market.

At 11:05 CST, about 5,900 canola contracts had changed hands.

Western barley futures were stronger, taking some direction from CBOT corn with 49 contracts traded by midsession.

Prices in Canadian dollars per metric ton at 11:05 CST: