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Prairie wheat bids down with U.S. futures

MGEX September wheat futures dropped by more than four per cent on the week

Wheat bids in Western Can­ada were down for another week, as trade tensions continued to weigh on U.S. futures markets.

Depending on the location, average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were down by $6 to $13 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 $216 per tonne in western Manitoba to as high as $229 in southern Alberta. Northwestern Saskatchewan was an outlier, rising $6, to $220 per tonne.

Quoted basis levels varied from location to location and ranged from $19 to $32 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$164 to US$174 per tonne. That would put the currency-adjusted basis levels at about US$23 to US$33 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 $30 to $43 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids fell anywhere from $8 to $10 per tonne depending on the location. Prices ranged from $182 to $200 per tonne.

Average durum prices were lower, with bids in Western Canada coming in at about $235 to $259 per tonne.

The September spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted June 29 at US$5.3675 per bushel, down 24.25 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$4.885 per bushel on June 29, down 17 U.S. cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled at US$5.0125 on June 29, down three U.S. cents on the week.

The Canadian dollar settled June 29 at 75.94 U.S. cents, up 0.8 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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