MarketsFarm — Spring wheat bids in Western Canada dropped sharply lower during the last week of April, as a selloff in U.S. futures more than offset any support from a weaker Canadian dollar.
Average Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were down by $25.90-$27.50 per tonne across the Prairies, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from $350.10 per tonne in southeastern Saskatchewan to as high as $370 per tonne in southern Alberta.
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As the harvest in southern Alberta presses on, a broker said that is one of the factors pulling feed prices lower in the region. Darcy Haley, vice-president of Ag Value Brokers in Lethbridge, added that lower cattle numbers in feedlots, plentiful amounts of grass for cattle to graze and a lacklustre export market also weighed on feed prices.
Quoted basis levels varied from location to location and ranged from $61.70 to $81.60 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 everything into Canadian dollars, CWRS basis levels ranged from $12.20 to $22.90 below the futures.
Canada Prairie Spring Red (CPSR) wheat bids were down by $21.90-$23.40 per tonne, with prices ranging from $335.10 to $358 per tonne.
Average durum prices lost between 80 cents and $2.20 per tonne. Prices ranged from $429.30 to $443.20 per tonne.
Minneapolis spring wheat futures were down by 70.25 U.S. cents per bushel in the July contract to settle Thursday at US$7.85 per bushel.
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 down by 61.5 U.S. cents on the week to close at US$7.6525 per bushel on Thursday.
The July Chicago Board of Trade soft wheat contract settled at US$6.2925 per bushel on Thursday, down 50.75 U.S. cents on the week.
The Canadian dollar was down by roughly three-quarters of a cent relative to its U.S. counterpart, finishing Thursday at 73.46 U.S. cents.
— Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg.
