ICE Canola Weakens on CBOT Losses, Demand Drop-Off

Early losses in canola were fueled by the sell-off overnight in Malaysian palm oil, Matif rapeseed, and e-CBOT soybean futures. Losses in global crude oil and the North American equity sectors helped to undermine the markets, brokers said.

The absence of fresh export demand contributed to the downward price action in canola with the lack of fresh domestic processor interest also adding to the bearish price sentiment in canola, traders said.

The losses seen in CBOT soyoil with the start of the North American day session further weighed on canola values.

The losses in canola were being tempered in part by continued weather uncertainties. Temperatures were unseasonably cool during the weekend across the Canadian prairies. Frost occurred in parts of Alberta, western Saskatchewan and Manitoba during the weekend. Any crops vulnerable to frost will likely have to be reseeded, brokers said. The below normal readings have also caused crops in western Canada to fall behind in development, leaving them vulnerable to an early frost at harvest time, traders said. An official with the Canadian Wheat Board estimated that crops were roughly week to 10 days behind in development.

Helping to slow the price drop in canola was the weak Canadian dollar in early Monday activity.

There were an estimated 8,795 canola contracts traded at 10:51 CDT. Of the contracts traded, 5,764 were spread related.

There were no western barley futures traded as of 10:51 CDT.

Prices in Canadian dollars per metric ton at 10:51 am CDT: