ICE Canola Stronger On C$, Poor Harvest, China Rumors

Canadian government officials met with their Chinese counterparts on Friday in an attempt to postpone the implementation of new blackleg-free phytosanitary certificates on canola that would effectively shut Canada out of the Chinese market.

"We must have had some news out of China," said a canola broker on the strength in canola. However, traders could not confirm that a resolution had been found and calls to the Canola Council of Canada were not immediately returned. Exporters close to the situation had also not heard any definitive news out of China.

Aside from the Chinese rumors, canola prices were also supported by the weaker Canadian dollar, which was down by more than a cent relative to its US counterpart, said the broker. Although he noted that currency alone could not account for all of the strength in the canola market.

Ongoing harvest delays to the last of the canola crop in Saskatchewan and Alberta were also supportive. Saskatchewan Agriculture reported Thursday that 30% of the province’s canola crop was still unharvested.

A broker said funds were good buyers, as canola prices moved above some nearby technical levels.

Losses in the CBOT soy complex limited the upside in canola, said traders. Month-end profit-taking also tempered the gains.

At 11:14 CDT, about 7,300 canola contracts had changed hands. The Nov/Jan spread was a feature as participants continue to roll out of the nearby November.

Western barley futures were holding steady with only 14 contracts traded by midsession.

Prices in Canadian dollars per metric ton at 11:14 CDT: