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Wheat bids improve in Western Canada as loonie dips

MGEX December spring wheat was up 13.25 U.S. cents a bushel from the previous week

Hard red spring wheat bids in Western Canada moved higher during the week ended Sept. 22, as gains in Minneapolis futures and weakness in the Canadian dollar provided support.

Depending on the location, average Canada Western Red Spring (CWRS) 13.5 per cent wheat prices were up by $2 to $3 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 western Manitoba to as high as $243 in southern Alberta.

Quoted basis levels varied from location to location, but generally held steady to range from about $9 per tonne below the futures to $9 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$181 to US$197 per tonne, unchanged on a U.S. dollar basis on the week. That would put the currency-adjusted basis levels at about US$36 to US$52 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 $44 to $64 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids were up by anywhere from $1 to $16 per tonne, with prices ranging from $166 to $182 per tonne.

Average durum prices held relatively steady, with bids in Saskatchewan coming in at about $264 to $267 per tonne.

The December spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based, was quoted Sept. 22 at US$6.3475 per bushel, up 13.25 U.S. cents from the previous week.

Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPSR in Canada. The December K.C. wheat contract was quoted at US$4.5025 per bushel on Sept. 22, up 4.25 U.S. cents compared to the previous week.

The December Chicago Board of Trade soft wheat contract settled at US$4.495 on Sept. 22, up 0.5 U.S. cent on the week.

The Canadian dollar settled Sept. 22 at 81.19 U.S. cents, down roughly one cent on the week.

About the author

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Phil Franz-Warkentin writes for MarketsFarm specializing in grain and commodity market reporting.

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