CWRS bids rise along with weaker Canadian dollar

Basis levels across Western Canada range from C$19 to C$39 below the futures

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Published: April 27, 2017

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CWRS bids rise along with weaker Canadian dollar

Hard red spring wheat bids in Western Canada moved higher during the week ended April 21, as sharp weakness in the Canadian dollar made up for the softer tone in the Minneapolis spring wheat futures.

Depending on the location, average Canada Western Red Spring (CWRS) wheat prices were up by C$2 to C$4 per tonne across the Prairie provinces, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about C$222 per tonne in western Manitoba, to as high as C$242 in northern Alberta.

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Quoted basis levels varied from location to location, but generally ranged from about $28 to $48 per tonne above the futures when using the grain company methodology of quoting the basis as the difference between the 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 (C$1=US$0.7404 as of April 21), CWRS bids ranged from US$164 to US$179 per tonne. That would put the currency-adjusted basis levels at about US$14 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 C$19 to C$39 below the futures.

Canada Prairie Red Spring (CPRS) wheat bids were down by C$2 to C$4 per tonne, with prices ranging from C$147 to C$161 per tonne.

Average durum prices were up by C$2 to C$4 per tonne, with bids in Saskatchewan coming in at about C$252 to C$259 per tonne.

The July spring wheat contract in Minneapolis, which most CWRS contracts Canada are based off of, was quoted at US$5.3550 per bushel on April 21, down by 3.25 cents from the previous week.

The Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPRS in Canada. The July Kansas City wheat contract was quoted at US$4.1725 per bushel on April 21, down by 22 U.S. cents compared to the previous week.

The July Chicago Board of Trade soft wheat contract settled at US$4.2100 on April 21, which was down by about 21.75 U.S. cents on the week.

The Canadian dollar settled at 74.04 U.S. cents on April 21, which was down by roughly a full cent relative to its U.S. counterpart compared to the previous week.

About the author

Phil Franz-Warkentin

Phil Franz-Warkentin

Editor - Daily News

Phil Franz-Warkentin grew up on an acreage in southern Manitoba and has reported on agriculture for over 20 years. Based in Winnipeg, his writing has appeared in publications across Canada and internationally. Phil is a trusted voice on the Prairie radio waves providing daily futures market updates. In his spare time, Phil enjoys playing music and making art.

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