Cash bids for western Canadian spring wheat were sharply lower during the week ending Monday, as basis levels widened following Statistics Canada’s production report on Dec. 4.
The report showed a shockingly large 37.53 million-tonne 2013-14 Canadian wheat crop. The 2012-13 Canadian wheat crop produced 27.21 million tonnes.
Average spot bids on Monday for Canada Western red spring (CWRS, 13.5 per cent protein) across Manitoba, Saskatchewan, and Alberta came in at around $C192 per tonne, or $5.21 per bushel, based on pricing available from a cross-section of delivery points, which compares to $208 per tonne ($5.67/bu.) the week prior. Basis levels were wider at a discount of $51 relative to the futures, from $50 the week prior.
Average Canada Prairie spring red (CPSR) values were at C$171 per tonne ($4.66/bu.), down from $182 per tonne ($4.96/bu.) a week ago. Average basis levels were widened to a discount of $85 compared to futures, from $77 the week prior.
U.S. wheat futures were sharply lower, as both Canada and Australia increased their wheat production estimates for 2013-14. The large global supply situation and lacklustre demand were bearish.
However, concerns about recent cold weather damaging some U.S. winter wheat crops limited the downside for Kansas City futures.
The March spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted at US$6.7675/bu. on Monday, down 25.75 cents from the previous week.
The Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPSR in Canada. The March Kansas City wheat lost 5.75 cents over the week, settling Monday at US$6.96/bu.
Durum prices were weaker, as StatsCan increased its production figure to 6.5 million tonnes, from 4.63 in 2012-13. Average spot bids decreased by $6 per tonne, to $199 ($5.43/bu.).
— Terryn Shiells writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.