MarketsFarm — Warmer-than-normal temperatures and ongoing dryness in both Western Canada and the U.S. helped raise Prairie wheat bids for the week ended Thursday.
Rains fell onto parts of northern and central Alberta on Thursday, but the rest of the Prairies only saw sporadic showers, if any, during the week. Traders on the Chicago Board of Trade (CBOT) seemed to ignore expanding drought conditions in the U.S. Midwest judging by slow declines in wheat prices for most of the week. However, prices jumped by 23 to 32 U.S. cents per bushel on Thursday as weather premiums for corn and soybeans spilled over into wheat.
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Canada Western Red Spring (CWRS) wheat prices added $5.20-$8 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices were between $367.90/tonne in southeastern Saskatchewan and $387.10 in northern Alberta.
Quoted basis levels ranged between $61.90 and $81.10/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.
Accounting for exchange rates and adjusting Canadian prices to U.S. dollars, CWRS bids were from US$277.60 to US$292.10/tonne. Currency-adjusted basis levels ranged from US$13.90 to US$28.40 below the futures. If the futures were converted to Canadian dollars, basis levels would be $10.50-$21.40 below the futures.
Meanwhile, Canada Prairie Spring Red (CPSR) wheat prices also increased, up $2.20-$13.10/tonne. The lowest average bid for CPSR was $341.20/tonne in southeastern Saskatchewan, while the highest average bid was $370.80 in the Peace region.
The average prices for Canada Western Amber Durum (CWAD) were unchanged to down $4.90 per tonne with bids between $378.50 in southern Alberta to $394.70 in northwestern Saskatchewan.
The July spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday at US$8.3275 per bushel, 17 U.S. cents higher than the previous week.
Kansas City hard red winter wheat futures, traded in Chicago, are more closely linked to CPSR in Canada. The July K.C. wheat contract was quoted Thursday at US$8.1275/bu., up eight U.S. cents.
The July Chicago Board of Trade (CBOT) wheat contract gained 35.25 U.S. cents from the previous week, coming in Thursday at US$6.615/bu.
The Canadian dollar was stronger, gaining 0.6 of a U.S. cent to close at 75.46 cents U.S. on Thursday.
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.
