ICE Canola Up On Commercial Demand

Canola saw an active trade with intermonth spreading once again accounting for much of the volume.

The total canola volume was estimated at 16,389 contracts, down from 20,264 contracts on Wednesday, including an estimated 13,278 contracts involved in the spread trade.

Canola was modestly higher in the overnight market reflecting the gains in European and Asian vegetable oil prices. Canola extended its gains as the North American trading session opened and Chicago Board of Trade soybeans rallied to 3 month highs. Canola backed down with the weakening in the US soy complex, ending higher with the best gains in the nearby contracts.

Canola was supported by strong commercial demand prompted by favorable crush margins and talk of fresh export activity. A strong export lineup for April and May prompted the bigger gains in the nearby contracts. A slower pace to farmer selling , the weak Canadian dollar and friendly technical signals contributed to the gains.

Capping the advance was the expectation that farmer selling would yet increase as producers are sitting on over 6.5 mln metric tons of canola and are expected to deliver about 4 mln tonnes of that by the end of the crop year on July 31st, analysts said.

Crushers and exporters were steady buyers with speculative buying also noted. The selling was mostly commercial with light elevator company scale up offerings noted and some commercial liquidation selling evident.

Western barley ended steady in light commercial activity with the bulk of the trade being intermonth spread trading amid a lack of interest, said brokers.

The total barley volume was estimated at 29 contracts, down from 211 contracts on Wednesday, including an estimated 26 contracts involved in the spread trade.

Prices are in Canadian dollars per metric ton: