Prairie wheat bids stuck in downtrend

Western Canadian wheat cash bids moved lower during the week ended Dec. 23, following losses seen in U.S. futures markets. Basis levels also widened for Canada Western Red Spring (CWRS) and Canada Prairie Spring Red (CPSR) varieties, which contributed to the price weakness.

Average spot bids on Monday for CWRS (13.5 per cent protein) across Manitoba, Saskatchewan and Alberta came in at around $170 per tonne, or $4.63 per bushel, based on pricing available from a cross-section of delivery points, which compares to $178 per tonne, or $4.85/bu. the week prior. Basis levels widened to an average of $66 relative to the futures, from $62 the previous week.

Average CPSR values were at $147 per tonne, or $3.99/bu., down from $157 per tonne, or $4.27/bu. a week ago. Average basis levels were widened to a discount of $91 compared to futures, from $85 the week prior.

U.S. wheat futures were sharply lower, as the large global supply situation continued to overhang prices and U.S. values drifted lower in an attempt to uncover some demand of their own.

The March spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Monday at US$6.44/bu., down 10.25 cents from the previous week.

Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPSR in Canada. The March Kansas City wheat lost 17 cents over the week, settling Monday at US$6.485/bu.

Durum prices moved lower in reaction to the large global supply situation and logistical problems in moving the Canadian crop. Average spot bids decreased by $8, to $181 per tonne ($4.92/bu.).

– Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.