MarketsFarm — While wheat futures on the Chicago Board of Trade (CBOT) were higher after hitting low points, bids for Western Canadian wheat were mixed to lower for the week ended Thursday.
The Canadian dollar gained ground against a weakening U.S. greenback, moving up by more than one U.S. cent. The loonie spent the week recovering from a 20-month low after the Bank of Canada raised its key interest rate by one full point to 2.5 per cent on July 13. Normal temperatures to go with rainfall also put pressure on western Canadian wheat bids.
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Meanwhile, nearby Chicago wheat and Kansas City hard red wheat contracts traded at their lowest prices since February before finding some support. Negotiations between Turkey, Russia, Ukraine and the United Nations to re-open a Black Sea shipping corridor caused caution.
Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices ranged from a loss of $2 to a gain of 40 cents per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices were between $406 in southeastern Saskatchewan and $426 in northern Alberta.
Quoted basis levels ranged between $70.70 and $90.70 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$314.80 to US$330.40 per tonne. Currency-adjusted basis levels ranged from US$4.90 to US$20.50 below the futures. If the futures were converted to Canadian dollars, basis levels would be $3.80 to $15.90 below the futures.
Average Canada Prairie Spring Red (CPSR, 11.5 per cent protein) prices declined $1.30-$3.50 per tonne. The lowest average bid for CPSR wheat was $367.10 in southeastern Saskatchewan, while the highest average bid was $374.60 in southern Alberta.
Meanwhile, average Canada Western Amber Durum prices were down $7.60-$14.40 per tonne, with bids ranging from $451.60 in northwestern Saskatchewan to $467.70 in western Manitoba.
The September spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted at US$9.125 per bushel on Thursday and two 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 September K.C. wheat contract was quoted at US$8.6125, up 12.5 U.S. cents.
The September Chicago Board of Trade wheat contract also gained 11.25 U.S. cents from the previous week at US$8.0625 on Thursday.
The Canadian dollar gained 1.43 U.S. cent from the previous week to close at 77.55 U.S. cents on Thursday.
