Western Wheat Bids Gain with U.S. Futures

Winnipeg – Hard red spring wheat bids in Western Canada generally moved higher in most locations during the week ended July 20, tracking gains in the U.S. futures.

Average Canada Western Red Spring (13.5 percent CWRS) wheat prices were down by C$9 per tonne in northwestern Saskatchewan but up by C$9 to C$11 per tonne in most other locations, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about C$211 per tonne in northwestern Saskatchewan, to as high as C$240 in southern Alberta.

Quoted basis levels varied from location to location and ranged from $7 to $37 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$0.7609) CWRS bids ranged from US$160 to US$182 per tonne. That would put the currency adjusted basis levels at about US$22 to US$44 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$29 to C$58 above the futures.

Canada Prairie Red Spring (CPRS) wheat bids were stronger, gaining anywhere from C$5 to C$7 per tonne depending on the location. Prices ranged from C$191 to C$208 per tonne. Average durum prices were narrowly mixed, with bids in southern Saskatchewan coming in C$233 to C$255 per tonne.

The September spring wheat contract in Minneapolis, which most CWRS contracts Canada are based off of, was quoted at US$5.5500 per bushel on July 20, up by 23.25 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 September Kansas City wheat contract was quoted at US$5.0850 per bushel on July 20, up by 16.75 U.S. cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled at US$5.1600 on July 20, which was up by 19.00 U.S. cents on the week.

The Canadian dollar settled at 76.09 U.S cents on July 20, which was up by about a fifth of a cent on the week.

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