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Spring wheat bids rise off of nearby lows

September U.S. wheat futures climb by 14 to 24.5 U.S. cents on the week

Hard red spring wheat bids in Western Canada moved higher in most locations during the week ended July 6, taking some direction from a rally in U.S. futures as prices corrected off of nearby lows.

Average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were down $9 per tonne in northwestern Saskatchewan but up by $5-$11 per tonne in most other locations, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $211 per tonne in northwestern Saskatchewan to as high as $241 in eastern Manitoba.

Quoted basis levels varied from location to location and ranged from $6 to $36 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$161 to US$184 per tonne. That would put the currency-adjusted basis levels at about US$21-$44 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 $27 to $58 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids were stronger, gaining anywhere from $5 to $9 per tonne depending on the location. Prices ranged from $191 to $205 per tonne.

Average durum prices were narrowly mixed, with bids in southern Saskatchewan coming in at about $257 per tonne.

The September spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based, was quoted July 6 at US$5.5825 per bushel, up 21.5 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$5.13 per bushel on July 6, up by 24.5 U.S. cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled at US$5.1525 on July 6, up 14 U.S. cents on the week.

The Canadian dollar settled July 6 at 76.35 U.S. cents, up by about half a cent on the week.

About the author

Columnist

Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

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