ICE Canola Up On Vegoil Gains

Canola saw a moderate trade with light intermonth spreading evident.
Year end and month end positioning was noted.

The total canola volume was estimated at 9,405 contracts, up from Wednesday’s 8,395 contracts, including an estimated 2,495 contracts involved in the spread trade.

Canola was mixed in the overnight trade, starting lower than Wednesday’s close, rising through the night to gains as the North American trading session opened and the Chicago Board of Trade soybean market rallied. Canola saw a thinly traded choppy session ending the day modestly higher.

Canola drew much of its support from the gains in international vegetable oil markets with the strength in CBOT soybeans also supportive, traders said. The lack of farmer selling, friendly technical signals and positioning by speculators ahead of the expected index fund rebalancing of their accounts next week all contributed to the advance, traders said.

However, the advances were small as the very strong Canadian dollar, the ample Canadian canola supply and the lingering uncertainty about canola exports to China limited the upside in the market.

Adding to the choppy price movement was the fact that volumes were very small with many participants sidelined until the new year.

Routine exporter and crusher buying was augmented by speculative buying. The selling was mainly commercial although year end liquidation was also noted.

Western barley ended mixed in light trade.
The market was dominated by liquidation of Jan contracts ahead of month end
prompting short covering which rallied the Jan contract sharply. The rest of the market was undermined by sluggish demand, said brokers.

The total barley volume was estimated at 123 contracts, up from Wednesday’s 38 contracts, including an estimated 60 contracts involved in the spread trade.

Prices are in Canadian dollars per metric ton: