Prairie cash wheat: Prices rise as worldwide stocks fall

U.S. December wheat futures up on week

(Thinkstock photo)

MarketsFarm — Continued tightening of worldwide wheat stocks has raised spring wheat prices in Western Canada during the week ended Thursday.

As winter wheat planting in North America and Europe begins, dry conditions remain a threat not only in North America, but also in Argentina and Russia.

The U.S. Department of Agriculture (USDA) also predicts the world’s exportable supplies of wheat to be at its lowest level in eight years this winter, further supporting prices. Rising wheat futures and a declining Canadian dollar also supported bids.

Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were up $14.10-$15.80 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices were between $381.10 in southeastern Saskatchewan and $402 in northern Alberta.

Quoted basis levels ranged $48.10-$68.90 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.

Accounting for exchange rates and adjusting Canadian prices to U.S. dollars, CWRS bids were from US$300.70 to US$317.20 per tonne. Currency-adjusted basis levels ranged from US$15.90 to US$32.40 below the futures. If the futures were converted to Canadian dollars, basis levels would be $12.60-$25.50 below the futures.

Average Canada Prairie Spring Red (CPSR, 11.5 per cent protein) wheat prices were up $18.40-$23.20 per tonne. The lowest average bid was $349.10 in southeastern Saskatchewan, while the highest average bid was $364.10 in northern Alberta.

Average Canada Western Amber Durum (CWAD) prices dropped $52.40-$67.80 per tonne with bids ranging from $599.70 in southern Alberta to $623.10 in northeastern Saskatchewan.

The December spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted at US$9.065 per bushel on Thursday, 34 U.S. cents higher than the previous week.

Kansas City hard red winter wheat futures, traded in Chicago, are more closely linked to CPSR in Canada. The December K.C. wheat contract was quoted Thursday at US$7.205, up 37.75 U.S. cents.

The December Chicago Board of Trade wheat contract on Thursday was up 20.75 cents from the previous week at US$7.13.

The Canadian dollar lost 0.13 of a cent from the previous week to close at 78.9 U.S. cents on Thursday.

— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.

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