WINNIPEG (Dow Jones)--Grain and oilseed futures at the Winnipeg Commodity
 Exchange closed mainly higher, with canola surging to fresh contract highs on
 the rally in international vegetable oil prices, brokers said.
 
   Canola saw a heavy trade with intermonth spreading enhancing the volumes.
 Commercials were the main participants in the spread trade, although traders
 felt that commodity funds did sell about 1,500 July/November spreads.
 
   An estimated 10,348 contracts were involved in the spread trade as the total
 canola volume was estimated at 17,916 contracts, up from Monday's 14,106
 contracts.
 
   Canola rallied from the opening, quickly setting fresh contract highs in the
 new crop as overnight vegetable oil markets advanced, traders said. Fresh
 contract highs in Malaysian palm oil futures, gains in MATIF rapeseed and
 Tuesday's strength in Chicago Board of Trade soy complex values all combined to
 lift the market.
 
   Contributing to the gains were bullish technical signals, a slight weakening
 in the Canadian dollar and continued talk of Chinese demand for canola,
 analysts said.
 
   Farmer selling was on a scale up which offset the fact that country movement
 has seen a substantial increase. Country prices have climbed over C$8.75 a
 bushel for both old and new crop bids in much of western Canada attracting in
 the increased farmer pricing, cash dealers said.
 
   The favorable crop outlook and the fact that planting is virtually complete
 weighed on the market, traders said.
 
   Routine exporter buying was augmented by crusher buying, with commodity funds
 estimated to have purchased between 500 and 1,000 November contracts.
 Commission house buying was also evident in the trade. The selling was mainly
 commercial on a scale up and comprised of elevator company pricing as farmers
 have stepped up their deliveries and pricing, said dealers.
 
   Feed grains were mostly higher in light feed wheat and moderate barley trade.
 The early firm tone in U.S. grain markets gave support, as did slow farmer
 selling. Feed wheat posted gains in light liquidation trade as open interest
 continues to dwindle, traders said.
 
   Western barley advanced on end user demand, with strong interest in the new
 crop. Besides feed lot interest, there was some "intriguing" malt company
 pricing in the new crop, brokers said.
 
   "It looks like (maltsters) are finally accepting that the (Canadian Wheat
 Board) will be losing its control over the malt barley market with the new
 crop," a trader said.
 
   Western barley advanced as an estimated 809 contracts changed hands, down
 from Monday's 810 contracts.
 
   Feed wheat edged up as an estimated 105 contracts traded, up from Monday's 6
 contracts.
 
 
   Prices are in Canadian dollars per metric ton:
            Settlement   Change
            Prices
 Canola
 July       392.30       up 0.70
 Nov        409.80       up 2.20
 Feed Wheat
 July       162.90       up 0.40
 Oct        160.30       up 0.40
 Western barley
 July       189.00       up 2.30
 Oct        150.30       up 2.60
 
 
   Canola spread trade prices are in Canadian dollars and the volume represents
 the number of spreads
 
 Months          Price                 Volume
 
 July/Nov        15.40-17.90           4,214
 Mar/May         5.50                  341
 Nov/Jan         6.00-6.90             247
 Jan/Mar         5.00-6.10             170
 July/Jan        21.00-23.70           44
 July08/Nov08    13.40over-12.00over   87
 Nov/Mar         10.50-11.90           29
 Nov/July        22.50                 1
 May/July        4.50                  25
 Jan/July        15.00                 11
 July/Mar        27.70                 5