ICE canola firmed despite political, dollar drama

All figures in Canadian dollars unless noted

WINNIPEG, Manitoba, Jan 6 (Reuters) - ICE canola futures rose slightly on Monday on tight supplies, even as the resignation announcement of Canada's prime minister, a slump in the U.S. dollar and a slew of other outside factors unsettled markets, traders said.

* Most-active March canola RSH5 rose $1.80 to $625.80 per metric ton. Later months rose about one dollar more per ton.

* The Canadian dollar CAD= surged on U.S. dollar weakness and political drama in Ottawa.

* Prime Minister Justin Trudeau announced plans to resign after the Liberal Party of Canada picks a new leader, with an almost certainty of a federal election after Parliament resumes in late March.

* Canola futures are listed in Canadian dollars and are often hurt by gains in the currency - but that was not the case Monday, traders said.

* Canola market analyst Jon Driedger of LeftField Commodity Research said canola's supply and demand situation is bullish, but bearish risks of U.S. tariffs, the potential removal of U.S. biofuels supports, Chinese anti-dumping actions, and other geopolitical factors are making traders hold back from bidding up prices.

* "Everything's in a state of paralysis," said Driedger, noting it is impossible to quantify the risks posed by the potential U.S. and Chinese actions, because they might not occur, or might not occur as many expect.

* Traders will need to see a positive resolution to some of these issues before they give in to the bullish fundamentals, he said.

* Chicago Board of Trade soyoil futures BOv1 rose 1% to 40.33 U.S. cents per pound and at one point during the session reached the highest price seen since Dec. 17. Malaysian palm oil futures FCPOc3 fell 0.7% in the Monday session. European rapeseed futures rose 0.7%.

(Reporting by Ed White; Editing by Mohammed Safi Shamsi)

((ed.white@thomsonreuters.com))