Prairie cash wheat: Bids mostly weaker on U.S. price declines

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MarketsFarm — Bids in Western Canada for the week ended Thursday were steady to lower for Canada Western Red Spring (CWRS), Canada Prairie Spring Red (CPSR) and durum (CWAD) wheats, as declines in U.S. wheat prices weighed on values.

The Canadian dollar was up two-10ths of a U.S. cent during the week, which also put some pressure on values.

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Average CWRS (13.5 per cent) wheat prices were down $2-$3 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $223 per tonne in northeastern Saskatchewan to as high as $240 per tonne in southern Alberta.

Quoted basis levels varied from location to location and ranged from $30 to $46 per tonne above the futures when using the grain company methodology of quoting the basis as the difference between U.S. dollar-denominated futures and Canadian dollar cash bids.

When accounting for currency exchange rates by adjusting Canadian prices to U.S. dollars, CWRS bids ranged from US$168 to US$181 per tonne. That would put the currency-adjusted basis levels at about US$13-$25 below the futures.

Looking at it the other way around, if the Minneapolis futures are converted to Canadian dollars, CWRS basis levels across Western Canada range from $9 to $19 below the futures.

Bids for CPSR were either side of steady. Prices ranged from $195 per tonne in southeastern Saskatchewan to $215 per tonne in southern Alberta.

Average durum prices were down $1-$3 per tonne, with bids ranging from $263 per tonne in southwestern Saskatchewan to $280 per tonne in western Manitoba.

The March spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday at US$5.2675 per bushel, down 5.75 U.S. cents from the previous week.

Kansas City hard red winter wheat futures, traded in Chicago, are more closely linked to CPSR in Canada. The March K.C. wheat contract was quoted Thursday at US$4.66 per bushel, down 1.75 U.S. cents compared to the previous week.

The March Chicago Board of Trade soft wheat contract settled Thursday at US$5.4425 per bushel, down 1.2 U.S. cents on the week.

The Canadian dollar closed Thursday at 75.44 U.S. cents, up from 75.24 the previous week.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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Glen Hallick - MarketsFarm

Glen Hallick writes for MarketsFarm specializing in grain and commodity market reporting.

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