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Prairie wheat bids dip with U.S. futures

MGEX December spring wheat futures slipped by 11 U.S. cents on the week

Hard red spring wheat bids in Western Canada slipped during the week which ended Sept. 29, as losses in Minneapolis futures weighed on cash prices despite weakness in the Canadian dollar.

Depending on the location, average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were down as much as $2 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 $222 per tonne in western Manitoba to as high as $242 in northern Alberta.

Quoted basis levels varied from location to location, but generally held steady to range from about $7 below the futures to $13 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$178 to US$193 per tonne, slightly down on a U.S. dollar basis on the week. That would put the currency-adjusted basis levels at about US$36-$52 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 $45 to $65 below the futures.

Changes in Canada Prairie Spring Red (CPSR) wheat bids ranged from up by $1.50 to down by $1 per tonne, with prices ranging from $166 to $184 per tonne.

Average durum prices held fairly steady, with bids in Saskatchewan coming in at about $262-$269 per tonne.

The December spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based, was quoted at US$6.2375 per bushel on Sept. 29, down 11 U.S. cents from the previous week.

Kansas City hard red winter wheat futures, which trade in Chicago, are more closely linked to CPSR in Canada. The December K.C. wheat contract was quoted Sept. 29 at US$4.4275 per bushel, down 7.5 U.S. cents compared to the previous week.

The December Chicago Board of Trade soft wheat contract settled at US$4.4825 on Sept. 29, down 1.25 U.S. cents on the week.

The Canadian dollar settled Sept. 29 at 80.13 U.S. cents, down by roughly one cent on the week.

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