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Prairie wheat bids follow U.S. futures higher

The Canadian dollar rose almost one U.S. cent on the week

Hard red spring wheat bids in Western Canada rose over the past week, following the lead of U.S. futures markets, despite gains in the Canadian dollar.

Depending on the location, average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices rose by about $3-$4 per tonne in some areas of Western Canada, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $231 per tonne in western Manitoba to as high as $252 in parts of Alberta.

Quoted basis levels varied from location to location, but fell slightly, to range from about $1 to $22 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$186 to US$203 per tonne, which were down on a U.S. dollar basis on the week. That would put the currency adjusted basis levels at about US$27-$44 below the futures.

Looking at it the other way around, if Minneapolis futures are converted to Canadian dollars, CWRS basis levels across Western Canada range from $33 to $54 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids were up by $3-$4. Prices across the Prairies ranged from $175 per tonne in southwestern Saskatchewan to $195 per tonne in parts of Alberta.

Average durum prices were up across Western Canada, with bids ranging from about $268 to $275 per tonne.

The March spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Jan. 5 at US$6.2675 per bushel, up 12 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$4.375 per bushel on Jan. 5, up 10.25 U.S. cents compared to the previous week.

The March Chicago Board of Trade soft wheat contract settled at US$4.3075 on Jan. 5, up 3.75 U.S. cents on the week.

The Canadian dollar continued its rally, settling Jan. 5 at 80.63 U.S. cents, up by almost a whole cent compared to the previous 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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