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Prairie wheat bids down as crop conditions improve

MGEX, CBOT and K.C. September wheat futures slipped by 3.5-4.5 per cent on the week

Wheat bids in Western Canada were down with U.S. futures for the week ended June 15. Improving crop conditions across Canada and the U.S. weighed on markets.

Depending on the location, average Canada Western Red Spring (CWRS, 13.5 per cent) wheat prices were down $3-$6 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 $223 per tonne in northwestern Saskatchewan to as high as $251 in southern and northern Alberta and eastern Manitoba.

Quoted basis levels varied from location to location and ranged from $23 to $41 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$169 to US$190 per tonne. That would put the currency-adjusted basis levels at about US$20-$41 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 $26 to $54 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids fell anywhere from $5 to $6 per tonne depending on the location. Prices ranged from $212 to $226 per tonne.

Average durum prices were slightly higher, with bids in Western Canada coming in at about $237-$263 per tonne.

The September spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based, was quoted June 15 at US$5.81 per bushel, down 23 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 September K.C. wheat contract was quoted at US$5.3425 per bushel on June 15, down 21 U.S. cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled at US$5.135 on June 15, down 23.25 U.S. cents on the week.

The Canadian dollar settled June 15 at 75.89 U.S. cents, down 1.26 cents on the week.

About the author

CNSC

Ashley Robinson writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

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