Harvest pressure weighs on Prairie wheat bids

Cash bids for spring wheat in Western Canada continued to move lower during the week ended Monday, as harvest pressure and reports of good yields caused basis levels to widen.

Average spot bids for Canadian Western red spring (CWRS) wheat at 13.5 per cent protein across Manitoba, Saskatchewan and Alberta came in at around C$222 per tonne ($6.05 per bushel) based on pricing available from a cross-section of delivery points, which compares to C$227 per tonne ($6.18/bu.) the week prior.

Basis levels widened to average discount of C$35 relative to the futures, from a $31 discount seen the previous week.

Average Canadian Prairie red spring (CPRS) values were at C$200 per tonne ($5.44/bu.). That compares with prices of C$202 per tonne ($5.50/bu.) the previous week. Average basis levels widened to a discount of C$53 compared to futures, from $51 the week prior.

U.S. wheat futures were narrowly mixed, as the large supply prospects were being countered by solid export demand for U.S. wheat.

The December spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted at US$7.0175 per bushel on Monday, down one cent per bushel from the previous week.

Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPRS in Canada. The December Kansas City wheat contract held narrowly range-bound, gaining 1.25 cents over the week to finish at US$6.8975 per bushel on Monday.

Durum prices moved sharply lower amid harvest pressure and reports of large yields in Western Canada. Average spot bids were down by C$6 per tonne from the week prior at $233 ($6.33/bu.).

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

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