Prairie wheat bids soften with U.S. futures

(Country Guide file photo)

CNS Canada — Spring wheat cash bids across Western Canada softened during the week ended Friday, as a downturn in U.S. futures put pressure on prices.

Depending on the location, average Canada Western Red Spring (CWRS) wheat prices were down by roughly $5 per tonne, according to price quotes from a cross-section of delivery points across the Prairie provinces compiled by PDQ (Price and Data Quotes). Average prices ranged from about $202 per tonne in southeastern Saskatchewan to as high as $214 in parts of Alberta.

Quoted basis levels varied from location to location, but lost about $3 on average to range from $29 to $30 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 the Canadian dollar cash bids.

When accounting for currency exchange rates by adjusting Canadian prices to U.S. dollars, CWRS bids ranged from US$154 to US$164 per tonne, down by about $5-$8 compared to the previous week. That would put the currency-adjusted basis levels at about US$17 to US$29 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 range from $14 to $29 below the futures.

Average Canada Prairie Spring Red (CPSR) bids were roughly the same as the previous week. Average CPSR prices came in at about $165-$172 per tonne in Saskatchewan, and $177-$179 per tonne in Alberta.

Average durum prices were down by $9-$11 per tonne, depending on the location, with bids in Saskatchewan ranging from roughly $264 to $268 per tonne.

The September spring wheat contract in Minneapolis, which most CWRS contracts in Canada are based off of, was quoted Friday at US$4.995 per bushel, down 0.5 cents per bushel from the previous week.

Kansas City hard red winter wheat futures, traded in Chicago, are more closely linked to CPSR in Canada. The September K.C. wheat contract was quoted at US$4.2125 per bushel on Friday, down US9.75 cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled Friday at US$4.35, up by US4.75 cents on the week.

The Canadian dollar closed Friday at US76.69 cents, down by a third of a cent relative to its U.S. counterpart on the week.

— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

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