MarketsFarm — Spring wheat prices on the Canadian Prairies experienced sharp upticks while gains for durum were much more subdued.
A drop in U.S. wheat ratings fueled the upswing in wheat prices, as dry conditions took further hold with approximately 15 per cent of U.S. spring wheat now in drought. While that’s up four points from the previous rating, rain is in the seven- to 10-day forecast.
Ongoing uncertainty over Russia’s continued participation in the Black Sea export agreement added to the increased wheat prices — as did reduced projections in Russian wheat production in 2023 and the country’s war in Ukraine.
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Average Canada Western Red Spring Wheat (CWRS, 13.5 per cent protein) wheat prices advanced $20.80-$21.90 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Those prices ranged from about $389.50 per tonne in southeastern Saskatchewan to $407.90 per tonne in northern Alberta.
Quoted basis levels varied from location to location and ranged from $66.10 to $84.60 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$296 to US$310 per tonne. That would put the currency-adjusted basis levels at about US$13.40-$27.40 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 ranged from $10.20 to $20.80 below the futures.
Average Canada Prairie Spring Red (CPSR, 11.5 per cent protein) wheat prices gained $23.80-$28.30 per tonne. Bids ranged from $366.30 per tonne in southeastern Saskatchewan to $394.60 per tonne in the Peace region of Alberta.
Average Canada Western Amber Durum (CWAD) prices tacked on between 25 cents and $2.40 per tonne, with bids ranging from $378.90 per tonne in southern Alberta to $396 per tonne 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$8.80 per bushel, increasing 47.25 U.S. cents on the 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$8.71 per bushel, climbing 58.25 U.S. cents on the week.
The July Chicago Board of Trade soft wheat contract settled Thursday at US$7.39 per bushel, jumping 77.5 U.S. cents from the previous week.
The Canadian dollar was pegged Thursday at 75.99 U.S. cents, up a little more than a half cent on the week, which tempered further increases in Canadian prices.
— Glen Hallick reports for MarketsFarm from Winnipeg.
