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Hard red wheat bids rise in Western Canada

Minneapolis, Kansas City and Chicago March wheat futures all rose on the week

Hard red spring wheat bids in Western Canada strengthened during the week ended Nov. 30, as gains in Minneapolis futures and a softer tone in the Canadian dollar helped basis levels improve.

Average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were up $1-$3 per tonne over the course of the week, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $252 per tonne in southeastern Saskatchewan to as high as $274 in southern Alberta.

Quoted basis levels varied from location to location, but generally improved to range from $40 to $62 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$189 to US$206 per tonne. That would put the currency-adjusted basis levels at about $6-$23 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 $8 to $31 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids were stronger, gaining anywhere from $2 to $5 per tonne depending on the location. Prices ranged from $221 to $241 per tonne.

Average durum prices were up $1-$2 in most locations. Prices in southern Saskatchewan, where the bulk of the crop is grown, came in at about $211-$220 per tonne.

The March spring wheat contract in Minneapolis, which most CWRS contracts Canada are based off of, was quoted Nov. 30 at US$5.7575 per bushel, up 4.5 U.S. cents from the previous week.

Kansas City hard red winter wheat futures, traded in Chicago, are more closely linked to CPSR in Canada. The March K.C. wheat contract was quoted at US$5.0025 per bushel on Nov. 30, up 4.25 U.S. cents compared to the previous week.

The March Chicago Board of Trade soft wheat contract settled at US$5.1575 on Nov. 30, up 8.5 U.S. cents on the week.

The Canadian dollar settled Nov. 30 at 75.18 U.S. cents, down by nearly half a cent relative to its U.S. counterpart.

About the author

Columnist

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

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