ICE canola futures knocked down by soy weakness

Reuters12-18

(All figures in Canadian dollars unless noted)

WINNIPEG, Dec 16 (Reuters) - ICE canola futures fell Tuesday for a fourth consecutive loss on spillover weakness from other vegoils and soybeans.

• Most-traded March canola settled down $7.60 at $602.50 per metric ton, a 1-1/2 week low.

• January settled down $7.10 at $594. All contract months from January to November declined. New-crop November

sits at $589.70.

* The drop of January futures into sub-$600 territory could spur farmer selling for March and May on fears deferred months will follow, a trader said.

* Tuesday's drop caused March futures to break through and close beneath the 20-day moving average, a key technical level that has underpinned the contract since Dec. 9. March futures are now below all closely watched moving averages.

• Chicago Board of Trade soyoil futures fell 2.6% to 40.62 cents per pound, the lowest close since Sept. 18. Soybean futures contracts fell to contract lows on good growing conditions in Brazil and worries about Chinese demand for U.S. soybeans.

• Malaysian palm oil futures fell for a third straight session, reflecting worldwide weak vegoil prices and worries about demand in Asia.

• The Canadian dollar fell, hit by political instability within the ruling Liberal government following the resignation of Finance Minister Chrystia Freeland, as well as falling inflation some analysts see as signs of growing economic weakness.

(Reporting by Ed White)

((ed.white@thomsonreuters.com; (204) 898-9456))

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