MarketsFarm — Adverse weather on both ends of the U.S. Plains as well as a weaker Canadian dollar were both supportive factors for western Canadian wheat bids for the week ended Thursday.
For the second straight weekend, a Colorado low system hit the northern Plains as well as the eastern Prairie provinces on Sunday and Monday, bringing snow and rain to the region. With cool temperatures, snow cover and another system with heavy precipitation coming its way to end April, spring wheat seeding has been significantly delayed.
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Varied precipitation and warm temperatures were generally beneficial for crop development across Alberta during the week ended July 8, according to the latest provincial crop report released July 11.
Meanwhile, the southern Plains are still dealing with dry temperatures in winter wheat-growing areas, with the U.S. Department of Agriculture (USDA) rating the crop at 27 per cent good-to-excellent, the lowest level since 1989, on Monday. However, parts of the southwestern U.S. Plains are expected to receive much-needed moisture starting this weekend.
The Canadian dollar nearly lost two U.S. cents over the week, supporting wheat bids. However, Statistics Canada, in its first survey-based principal field crop estimates released on Tuesday, reported 25 million acres of wheat are expected to be seeded. The total is up from 23.4 million last year and above average trade expectations set at 24.2 million.
Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices gained $24.80-$26.10 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices were between $527.50 in southeastern Saskatchewan to $544.60 in northern Alberta.
Quoted basis levels ranged from between $90.10 and $107.10 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$411.20 to US$424.50 per tonne. Currency-adjusted basis levels ranged from US$12.90 to US$26.30 below the futures. If the futures were converted to Canadian dollars, basis levels would be $10.10-$20.50 below the futures.
Average Canada Prairie Spring Red (CPSR, 11.5 per cent protein) prices rose $11.20-$15.50 per tonne. The lowest average bid for CPSR wheat was $483.40 in southeastern Saskatchewan, while the highest average bid was $496.30 in northern Alberta.
Meanwhile, average Canada Western Amber Durum prices were down $1.30-$13.10 per tonne, with bids ranging from $559.40 in northwestern Saskatchewan to $574.40 in northeastern Saskatchewan.
The July spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday, at US$11.915 per bushel, 37 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$11.4125, down 2.25 U.S. cents on the week.
The July Chicago Board of Trade wheat contract increased 10.25 U.S. cents over the same period, closing Thursday at US$10.8575.
The Canadian dollar lost 1.86 cents from the previous week to close at 77.95 U.S. cents on Thursday.
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.
