Prairie wheat bids down with U.S. futures, rising loonie

CNS Canada — Cash bids for Canadian wheat dropped during the week ended Friday, as the combination of a rising Canadian dollar and dropping U.S. futures weighed on prices across the Prairies.

Average Canada Western Red Spring (CWRS) wheat prices were C$12-$16 per tonne lower, with bids ranging from about $204 per tonne in north-central Saskatchewan to as high as $219 per tonne in southern Alberta, according to price quotes from a cross-section of delivery points across Western Canada.

Quoted basis levels varied from location to location, but generally deteriorated, to average about C$9 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.

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When accounting for the currency exchange rates by adjusting the Canadian prices to U.S. dollars, CWRS bids ranged from US$166 to $178. That would put the currency-adjusted basis levels at about US$25-$35 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$31 to $43 below the futures.

Average Canada Prairie Spring Red (CPRS) bids were C$8-$16 per tonne lower. CPSR prices came in at about $150 per tonne in Manitoba, $159 per tonne in Saskatchewan, and $172-$182 per tonne in Alberta.

Soft white spring (CWSWS) wheat prices were down by C$12-$15 per tonne, ranging from $176 to $171 per tonne in Alberta.

Winter (CWRW) wheat prices were down by C$10-$16 across Western Canada, with prices ranging from $150 to $163 per tonne.

Durum (CWAD) prices held steady, with bids in southern Saskatchewan, where the bulk of the crop is grown, quoted at C$281 per tonne.

The July spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Friday at US$5.615 per bushel, down 10.25 cents from the week prior.

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$5.26 per bushel on Friday, down 9.25 cents from last week.

The July Chicago Board of Trade soft wheat contract settled at US$5.0375 on June 12, which was 13.25 cents weaker compared to the week prior.

The Canadian dollar closed Friday at US81.23 cents, which was up by nearly a cent relative to its US counterpart compared to the previous week.

— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

Table: The weekly snapshot of average published prices as of June 15, 2015. Futures prices (US$ per tonne) vary slightly due to changes while data is collected. Cash bids (C$ per tonne) have currency conversion included in the basis. Source: AGCanada.com.

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