Prairie cash wheat: Stronger U.S. prices boost Prairie values

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MarketsFarm — Bids in Western Canada were higher this past week for Canada Western Red Spring (CWRS), Canada Prairie Spring Red (CPSR) and Canada Western Amber Durum (CWAD) wheats.

Gains in U.S. wheat markets provided support as a stronger Canadian dollar kept a lid on further increases.

Average CWRS (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 $232 per tonne in southeastern Saskatchewan to as high as $251.50 per tonne in northern Alberta.

Quoted basis levels varied from location to location and ranged from $26 to $45 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$178 to US$193 per tonne. That would put the currency-adjusted basis levels at about US$13.50-$28 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 $10 to $22 below the futures.

Average CPSR (11.5 per cent protein) wheat prices were up $6-$8 per tonne. Bids ranged from $219 per tonne in southeastern Saskatchewan to $238 per tonne in southern Alberta.

Average durum prices were up $2-$5, with bids ranging from $290 per tonne in northwestern Saskatchewan to $297 per tonne in western Manitoba.

The December spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted Thursday at US$5.61 per bushel, up 8.75 U.S. cents from 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$5.63 per bushel, jumping 21 U.S. cents on the week.

The December Chicago Board of Trade soft wheat contract settled at US$6.0925 per bushel on Thursday, up 5.5 U.S. cents from the previous week.

The Canadian dollar pushed its way back above 76 U.S. cents this week; the loonie closed Thursday at 76.62 U.S. cents, up 1.71 U.S. cents.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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