Prairie wheat bids down as trade tensions weigh

Wheat bids in Western Canada continued their downward spiral for the week ended June 22, as ongoing trade tensions between the U.S. and China weighed on U.S. futures.

Depending on the location, average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were down $8-$11 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 $214 per tonne in northwestern Saskatchewan to as high as $242 in eastern Manitoba.

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Quoted basis levels varied from location to location and ranged from $8 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$182 per tonne. That would put the currency adjusted basis levels at about US$24-$45 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 $32 to $60 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids fell anywhere from $17 to $20 per tonne depending on the location. Prices ranged from $192 to $208 per tonne.

Average durum prices were lower, with bids in Western Canada coming in at about $238 to $261 per tonne.

The September spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based off of, was quoted June 22 at US$5.61 per bushel, down 20 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 June 22 at US$5.055 per bushel, down 27.75 U.S. cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled at US$5.0425 on June 22, down 9.25 U.S. cents on the week.

The Canadian dollar settled June 22 at 75.14 U.S. cents, down 0.75 cents on the week.

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Ashley Robinson - MarketsFarm

Ashley Robinson writes for MarketsFarm specializing in grain and commodity market reporting.

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