Prairie cash wheat: Prices dip due to stronger loonie

MarketsFarm — Wheat bids in Western Canada were down by varying degrees for the week ended Thursday.

Canada Western Red Spring (CWRS) wheat was steady to lower, Canada Prairie Spring Red (CPSR) was down, and Canada Western Amber Durum (CWAD) slipped a few cents. Increased strength in the Canadian dollar weighed on values, while support came from improved prices in the U.S. markets.

Average CWRS (13.5 per cent protein) wheat prices were steady to down $4 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about $228 per tonne in southeastern Saskatchewan, to as high as $245 per tonne in northern Alberta.

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Quoted basis levels varied from location to location and ranged from $35 to $51 per tonne above the futures when using the grain company methodology of quoting the basis as the difference between the U.S. dollar denominated futures and the Canadian dollar cash bids.

When accounting for currency exchange rates by adjusting Canadian prices to U.S. dollars, CWRS bids ranged from US$169 to US$181 per tonne. That would put the currency adjusted basis levels at about US$12-$25 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 $9 to $18 below the futures.

Average CPSR (11.5 per cent protein) wheat prices were down $3-$4 per tonne. Bids ranged from $208 per tonne in southeastern Saskatchewan to $222 per tonne in northern Alberta.

Average durum prices were steady to slightly lower, with bids ranging from $283 per tonne in southwestern Saskatchewan to $296 per tonne in western Manitoba.

The July spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday at US$5.2625 per bushel, rising seven 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 July K.C. wheat contract was quoted Thursday at US$4.7225 per bushel, gaining 8.25 U.S. cents compared to the previous week.

The July Chicago Board of Trade soft wheat contract settled Thursday at US$5.2375 per bushel, up 9.25 U.S. cents on the week.

The Canadian dollar closed Thursday at 74.03 U.S. cents, rising almost 1.4 cents on the week.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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