Better crop conditions weigh on spring wheat bids

Winnipeg (CNS Canada) – Hard red spring wheat bids in Western Canada moved lower during the week ended June 8, as improving North American crop conditions weighed on Minneapolis spring wheat futures.

Depending on the location, average Canada Western Red Spring (13.5 percent CWRS) wheat prices were down by C$3 to C$7 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 C$228 per tonne in northwestern Saskatchewan, to as high as C$256 in northern Alberta and eastern Manitoba.

Quoted basis levels varied from location to location and ranged from $10 to $38 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 (C$1=US$0.7715) CWRS bids ranged from US$176 to US$197 per tonne. That would put the currency adjusted basis levels at about US$20 to US$41 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 C$26 to C$53 below the futures.

Canada Prairie Red Spring (CPRS) wheat bids were weaker, losing anywhere from C$1 to C$3 per tonne depending on the location. Prices ranged from C$217 to C$231 per tonne.

Average durum prices were up C$2 to down C$2 per tonne, with bids in southern Saskatchewan coming in at about C$260 per tonne.

The July spring wheat contract in Minneapolis, which most CWRS contracts Canada are based off of, was quoted at US$5.9250 per bushel on June 8, down by 11.50 U.S. cents from the previous week.

The Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPRS in Canada. The July Kansas City wheat contract was quoted at US$5.3825 per bushel on June 8, down by 2.50 U.S. cents compared to the previous week.

The July Chicago Board of Trade soft wheat contract settled at US$5.2000 on June 8, which was down by 3.25 U.S. cents on the week.

The Canadian dollar settled at 77.15 U.S cents on June 8, which was unchanged on the week.

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