ICE Canola Up On Slow Farmer Selling

Canola saw a moderate level of trade with intermonth spreading accounting for much of the volume. Activity
was described as dull.

The total canola volume was estimated at 9,904 contracts, down from Tuesday’s 12,423 contracts, including an estimated 4,030 contracts involved in the spread trade.

Canola was higher in the overnight trading session as strength in vegetable oils, as Malaysian palm oil hit 9 month highs, gave support. Canola held onto its gains as the North American trading session got underway and the Chicago Board of Trade soy complex opened higher. Canola maintained its gains throughout the session, hitting its highest level since Sept 2008,
despite a choppy mixed tone in the US soy complex.

Canola drew support from the lack of significant selling, the weak Canadian dollar, friendly technical signals and weather delays in canola planting, analysts said. Capping the advance was the mixed choppy tone in CBOT soybeans and losses in soyoil futures. The lack of significant fresh export business was also a bearish influence.

Crusher and exporter buying was overall classed as routine, although traders did note exporter pricing in the new crop. Speculative buying was evident with commodity fund buying appearing. Traders estimated fund buying at 750-1,000 July contracts.

The selling came from light elevator company pricing with farmer selling generally sidelined by the focus on planting and the fact that prices will have to rise further to attract canola out of farmers’ hands, cash dealers said. Exporters did some selling in the Nov contract while commission house profit taking also appeared as the US soy complex turned choppy.

Western barley ended mixed in very light commercial trade. The lack of farmer selling was balanced off by sluggish demand, brokers said. That accounted for the very small price movement.

The total barley volume was estimated at 122 contracts, up from Tuesday’s 74 contracts, including an estimated 70 contracts involved in the spread trade.

Prices are in Canadian dollars per metric ton: