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Prairie wheat bids follow lead of most U.S. futures

Durum bids in northwestern Saskatchewan rose to line up with those in other regions

Wheat bids in Western Canada rose in price for the week ended Feb. 9, for the most part following the lead of the U.S. futures markets.

Depending on the location, average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices rose in Western Canada by $7-$9, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $235 per tonne in southeastern Saskatchewan to as high as $250 in northern Alberta.

Quoted basis levels varied from location to location, but rose to range from $13 to $28 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$186 to US$198 per tonne, which were up on a U.S. dollar basis on the week. That would put the currency-adjusted basis levels at about US$24-$36 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 $45 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids were up by $2-$4. Prices across the Prairies ranged from $188 per tonne in southwestern Saskatchewan to $209 per tonne in southern Alberta.

Average durum prices fell by $1-$2 in most of Western Canada; bids ranged from about $264 to $271 per tonne. For the past few weeks, northwestern Saskatchewan had been an outlier at around the $232-per-tonne mark, but this week rose $31 to fall in line with other wheat bids in Western Canada.

The March spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based, was quoted Feb. 9 at US$6.035 per bushel, down by a quarter of a U.S. cent 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$4.655 per bushel on Feb. 9, up 2.25 U.S. cents compared to the previous week.

The March Chicago Board of Trade soft wheat contract settled at US$4.49 on Feb. 9, up 2.25 U.S. cents on the week.

The Canadian dollar settled Feb. 9 at 79.31 U.S. cents, down by almost a cent and a half compared to the previous week. The loonie fell in value over the week as the price of oil dropped and stock markets in Canada and the U.S. were volatile.

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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