Cash wheat: Bids get support from U.S. gains

MarketsFarm — Wheat bids in Western Canada were higher for the week ended Thursday, with gains in CWRS, CPSR and CWAD wheats in all locations.

The Canadian dollar was up by more than a 10th of a cent on the week, which tempered gains.

Average CWRS (Canada Western Red Spring, 13.5 per cent protein) wheat prices were up $2-$3 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 $174 per tonne in southeastern Saskatchewan to as high as $223 in southern Alberta.

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Quoted basis levels varied from location to location and ranged from $18 to $37 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$155 to US$168 per tonne. That would put the currency-adjusted basis levels at about US$20-$33 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 $23 to $41 below the futures.

Bids for CPSR (Canada Prairie Spring Red) wheat were up $4 per tonne. Prices ranged from $174 per tonne in southeastern Saskatchewan to $191 per tonne in southern Alberta.

Average CWAD (Canada Western Amber Durum) prices were up $3-$5, with bids ranging from $242 per tonne in northwestern Saskatchewan to $255 per tonne in western Manitoba.

The September spring wheat contract in Minneapolis, off of which most CWRS contracts Canada are based, was quoted Thursday at US$5.0725 per bushel, up 5.25 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 Thursday at US$4.035 per bushel, up 9.75 cents compared to the previous week.

The September Chicago Board of Trade soft wheat contract settled at US$4.8375 per bushel on Thursday, up 17.5 cents on the week.

The Canadian dollar closed Thursday at 75.73 U.S. cents, an increase of 0.13 of a cent from the previous week.

— Glen Hallick writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

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