Winnipeg Commodity Exchange canola futures rose on Friday, touching new contract highs before closing below its peak, traders said. Strength in US soya complex sparked the rally. "We are in a bull market and we cannot turn this around until we get another crop coming in the ground," a trader said. "We have not had a weather scare yet. It is demand driven."
Canola settled $1.00 per tonne higher to $5.90 higher, with January up $5.40 at $482.10, March up $5.90 at $494.20 and May up $5.70 at $501.60. The January contract reached a new high of $483.10 during the trading session. Traders said crushers, funds and speculators were the main buyers on Friday.
Some farmers booked light sales of their canola but most were holding onto the bulk of their crop in hopes of further increases in the coming weeks. Farmer selling would probably be scarce for the rest of the month, a trader said. Japanese trading house Mitsui & Co said on Friday it will buy a 40 percent stake of a $120 million canola crush plan in Canada that Louis Dreyfus Canada Ltd will begin building early in 2008.
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