WINNIPEG (Dow Jones)--Grain and oilseed futures at the Winnipeg Commodity
 Exchange closed Tuesday's session lower as canola dropped sharply in step with
 the big price decline in Chicago Board of Trade soy complex futures, brokers
 said.
 
   Canola trade was heavy with intermonth spreading accounting for only a
 moderate amount of the volume.
 
   The total canola volume was estimated at 19,018 contracts, up from Monday's
 18,421 contracts as an estimated 7,288 contracts were involved in the spread
 trade.
 
   Canola futures started out lower and dropped heavily as the CBOT soy complex
 moved to its lows late in the session. Bearish technical signals prompted
 speculative selling with sell stops also triggered on the way down, traders
 said. The favorable crop outlook and the very strong Canadian dollar
 contributed to the price slide.
 
   Sluggish fresh exports weighed on the market as traders noted a report from
 German analyst Oil World intensified the selling. The magazine report that
 Polish and Black Sea rapeseed had been sold to Mexico and Pakistan at prices
 below Canadian canola.
 
   Light crusher buying was noted as exporter pricing of old sales on a scale
 down also appeared. Speculative short covering also helped to limit the price
 slide.
 
   The selling comprised commodity fund profit taking, commission house long
 liquidation and steady elevator company offerings, analysts said. They
 estimated that commodity funds had sold 2,500 to 3,000 November contracts
 Tuesday.
 
   Western barley dropped sharply in moderate trade. The steep decline in CBOT
 corn, the favorable crop outlook and bearish technical signals sent the market
 down, brokers said. Also weighing on the market was the uncertainty caused by
 the legal challenge to the government move to take the export barley monopoly
 away from the Canadian Wheat Board.
 
   The buying comprised end user pricing and short covering by participants who
 feel that the challenge of the government move on the CWB barley monopoly will
 fail. The selling was mainly profit taking by speculators.
 
   The total western barley volume was estimated at 1,346 contracts, up from
 Monday's 784 contracts. The spread trade was estimated at 196 contracts.
 
   Feed wheat posted losses in step with the general market price slide as the
 activity composed mainly of spreading of the July/October contracts. An
 estimated 263 contracts traded, up from only 1 contract traded on Monday with
 an estimated 242 contracts involved in the spread trade.
 
 
   Prices are in Canadian dollars per metric ton:
           Settlement   Change
           Prices
 Canola
 July      373.30       dn 10.10
 Nov       394.60       dn 10.80
 Feed Wheat
 July      171.00       dn 4.00
 Oct       168.50       dn 4.00
 Western barley
 Oct       169.30       dn 3.50
 Dec       172.00       dn 3.90
 
 
   Spread trade prices are in Can dollars and the volume represents the number
 of spreads
 
 Months         Price                  Volume
 
 Canola
 Jul/Nov        21.30-22.30            3,292
 Jul/Jan        31.30                  1
 Nov/Jan        8.40-9.60              297
 Nov/Mar        16.00                  1
 Nov/May        23.10                  1
 Nov/Jul        26.50-27.50            40
 Nov/Nov        17.50-17.60            2
 Jan/Jul        18.50                  10
 
 Barley
 Jul/Oct        30.00-29.00 over       71
 Oct/Dec        0.90-4.00              27