ICE Canola Up On Tightening Supply

Canola activity was moderate with intermonth spreading a factor in enhancing the level of trade.

The total canola volume was estimated at 12,423 contracts, up from Monday’s 9,380 contracts.

Canola was higher in the overnight market in response to firmness in international vegetable oil values. Canola held onto its gains as the North American trading session got underway and Chicago Board of Trade soybean futures rallied. Canola held onto its gains in the face of a choppy mixed tone in soybeans and ended higher.

Canola was supported by the firm tone in the CBOT soyoil market, favorable crush margins, bullish technical signals and slower farmer selling. Contributing to the gains was a report from Oil World magazine predicting that global rapeseed/canola production in 2009-10 will come in below demand and that global ending stocks will drop to just 5 mln metric tons from 7.7 mln in 2007-08.

Maintaining selling pressure in canola was the choppiness in CBOT soybeans and warmer weather for planting forecast for next week, traders said.

Crushers were the best buyers with routine exporter pricing noted. Commodity funds were also buyers picking up between 500 and 1,000 July contracts. The selling came from commercials with only light elevator company selling noted. Commission house profit taking was also evident after CBOT soybeans turned mixed.

Western barley ended a bit lower in light trade. The lack of demand weighed on the market amid a lack of fresh news.
Barley ignored gains in CBOT corn, brokers said.

The total barley volume was estimated at 41 contracts, down from 77 contracts on Monday.

Prices are in Canadian dollars per metric ton:

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