Prairie cash wheat: Prices stabilize following tumultuous week

MarketsFarm — Wheat bids in Western Canada were much more stable for the week ended Thursday than for previous week.

After double-digit losses last week, Canada Western Red Spring (CWRS) wheat incurred only small losses, while Canada Prairie Spring Red (CPSR) experienced small gains. Canada Western Amber Durum (CWAD) went from a significant decline to being either side of steady.

Support came from increases in Minneapolis and Kansas City wheat futures; however, Chicago wheat retreated a little. The Canadian dollar gained more than four-10ths of cent and continued to stymie further gains in wheat.

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Average CWRS (13.5 per cent protein) wheat prices were steady to down $1 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $205 per tonne in eastern Saskatchewan, to as high as $221 per tonne in northern Alberta.

Quoted basis levels varied from location to location and ranged from $23 to $39 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 Canadian dollar cash bids.

When accounting for currency exchange rates by adjusting Canadian prices to U.S. dollars, CWRS bids ranged from US$155 to US$168 per tonne. That would put the currency-adjusted basis levels at about US$15-$27 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 $11 to $20.50 below the futures.

Average CPSR (11.5 per cent protein) wheat prices were up $1-$2 per tonne. Bids ranged from $178 per tonne in southeastern Saskatchewan to $195 in northern and southern Alberta.

Average durum prices were down $1 to steady, with bids ranging from $269 per tonne in southwestern Saskatchewan to $283 in western Manitoba.

The September spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday at US$4.97 per bushel, up one U.S. cent 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 Thursday at US$4.25 per bushel, rising 7.75 U.S. cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled Thursday at US$4.9675 per bushel, losing 4.5 U.S. cents from the previous week.

The Canadian dollar closed at 75.66 U.S. cents on Thursday, rising 0.43 U.S. cent on the week.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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