Prairie wheat bids up sharply as U.S. futures rally

CNS Canada –– Cash bids for Canadian wheat were stronger during the week ended Thursday, as U.S. wheat futures rallied sharply higher and basis levels improved, in general.

Average Canada Western Red Spring (CWRS) wheat prices were C$10-$13 per tonne higher, with bids ranging from about $196 per tonne in north-central Saskatchewan to $214 per tonne in Manitoba, according to price quotes from a cross-section of delivery points across Western Canada.

Quoted basis levels varied from location to location, but were generally narrower compared to the week prior. Average basis improved slightly, to about C$3.25 per tonne below the futures, if 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.

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When accounting for the currency exchange rates by adjusting the Canadian prices to U.S. dollars, CWRS bids ranged from US$163 to $178. That would put the currency adjusted basis levels at about US$30-$45 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$36 to $54 below the futures.

Average Canada Prairie Spring Red (CPSR) bids were C$14-$16 per tonne higher. Average basis improved slightly, to about C$29 below the futures. CPSR prices came in at about $160 in Manitoba, $165-$166 per tonne in Saskatchewan, and $175-$178 in Alberta.

Soft white spring (CWSWS) wheat prices were up by C$12-$13 per tonne, ranging from $173 to $174 per tonne in Alberta.

Winter wheat (CWRW) prices were up sharply in Manitoba and Saskatchewan, seeing gains of C$14-$20 per tonne, with prices coming in around $157-$170. Prices for winter wheat in Alberta were down C$6-$12 per tonne, as basis levels in the region widened significantly. Values were in the C$133-$139 per tonne range in Alberta.

Durum (CWAD) prices were steady to C$8 per tonne lower, with prices in southern Saskatchewan, where the bulk of the crop is grown, quoted at $276 per tonne.

The July spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted at US$5.665 per bushel on Thursday, up 25.5 cents from the week prior.

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 quoted Thursday at US$5.4325 per bushel, up 34.75 cents from last week.

The July Chicago Board of Trade (CBOT) soft wheat contract settled at US$5.1425 on Thursday, 32.75 cents stronger compared to the week prior.

The Canadian dollar closed Thursday at US83.34 cents, up 63 points relative to its U.S. counterpart compared to the previous week.

Terryn Shiells writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

Table: The weekly snapshot of average published prices as of May 15, 2015. Futures prices (US$ per tonne) vary slightly due to changes while data is collected. Cash bids (C$ per tonne) have currency conversion included in the basis. Source: AGCanada.com.

CWRSFuture.    .Basis.    .Net
Manitoba206.776.91213.68
Sask North Central.    .206.63-10.37196.25
Sask South206.31-1.45204.86
Alberta South208.112.33210.44
Alberta Central208.24-8.53199.71
Peace207.98-8.49199.49
CPSRFutureBasisNet
Manitoba200.39-40.23160.16
Sask North Central199.28-33.52165.76
Sask South198.67-33.89164.78
Alberta South200.43-22.85177.59
Alberta Central200.51-22.10178.41
Peace200.18-25.06175.11
CWSWSFutureBasisNet
Alberta South188.37-14.40173.97
Alberta Central188.60-13.87174.74
Peace188.22-15.10173.12
CWRWFutureBasisNet
Manitoba200.73-31.04169.69
Sask North Central199.28-42.48156.80
Sask South198.67-38.37160.30
Alberta South197.68-61.24136.44
Alberta Central198.91-59.59139.32
Peace197.68-63.96133.72
CWAD  Net
Sask North Central290.07
Sask South276.02
Alberta South278.71
Alberta Central310.20

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