MarketsFarm — Western Canadian spring wheat bids were the beneficiaries of rising U.S. futures prices for the week ended Thursday.
Wheat futures on the Chicago Board of Trade (CBOT) were under pressure early in the week due to healthy yet ineffective rains over wheat-growing areas in the U.S. The U.S. Department of Agriculture raised the good-to-excellent rating of the country’s winter wheat crop by two points, to 28 per cent, as of Sunday. However, the poor-to-very poor rating also increased from 41 to 42 per cent.
Read Also
Alberta crop conditions improve: report
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.
Prices were given a boost on Wednesday after video surfaced of two drones attacking the Kremlin, which Russia claimed was an attempt to assassinate Russian President Vladimir Putin. There were no casualties and Ukraine has vehemently denied Russia’s allegations.
The attacks came as talks resumed amongst the United Nations, Turkey, Ukraine and Russia to renew the Black Sea Grain Initiative. Russia has said it will not renew the agreement unless concessions are made.
CWRS (Canada Western Red Spring) prices gained $11.40-$14.20 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices were between $363.40/tonne in southeastern Saskatchewan and $381.50 in northern Alberta.
Quoted basis levels ranged $65-$83.20/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$267.90 to US$281.20/tonne. Currency-adjusted basis levels ranged from US$17.10 to US$30.50 below the futures. If the futures were converted to Canadian dollars, basis levels would be $12.60-$22.50 below the futures.
Meanwhile, CPSR (Canada Prairie Spring Red) wheat prices were also higher, up $13.70-$16.70/tonne. The lowest average bid for CPSR was $351.80/tonne in southeastern Saskatchewan, while the highest average bid was $371.80 in southern Alberta.
Average durum prices were down $1.80-$10.70 per tonne, with bids between $420.30 in southwestern Saskatchewan and $437 in southern Alberta.
The July spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday at US$8.12 per bushel, 27 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 at US$7.9825/bu., up 33 U.S. cents.
The July CBOT wheat contract gained 15.75 U.S. cents from the previous week, ending Thursday at US$6.45/bu.
The Canadian dollar was stronger, adding 0.25 U.S. cent to close Thursday at 73.71 U.S. cents.
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.
