ICE Canola Ends Mostly Higher on Supportive Chart Signals

By Dwayne Klassen, Commodity News Service Canada

March 22, 2013

WINNIPEG – Canola futures on the ICE Canada trading platform finished Friday’s session mainly higher with some of the upward price action related to supportive chart signals. Concerns about tight old crop canola supplies helped to keep a firm floor under the nearby months, market watchers said.

The ability of the May future to move into a band of technical resistance and hold those levels sparked some additional speculative and commodity fund buying.

Steady commercial demand, said to be covering both domestic crusher interest and export commitments, contributed to the price

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strength seen in canola, brokers said. With the demand, the need to ration remaining canola supplies added to the upward price action.

The buying back of previously sold positions ahead of the weekend further lifted canola futures with the absence of significant farmer deliveries into the cash pipeline adding to the support.

The upside in canola was tempered by the losses displayed by CBOT soybean futures. The advancing harvest of a record sized soybean crop in South America and the upswing in the value of the Canadian dollar also restricted the upside price potential in canola.

News that China has agreed to permit imports of Australian canola under specific conditions also limited the strength in canola futures, brokers said.

There were an estimated 16,601 canola contracts traded Friday, up from the 14,138 contracts that changed hands during the previous session.

No milling wheat, durum or barley contracts were traded during the session.

Prices are in Canadian dollars per metric ton.