Prairie wheat bids mixed as choppy futures trend lower

Glacier FarmMedia – Spring wheat bids in Western Canada were mixed during the week ended Feb. 23 as choppy activity in the United States futures spilled into the cash market.

Wheat futures tested fresh contract lows during the week, but also uncovered support at times amid the general downtrend.

Average Canada Western Red Spring (13.5%) wheat prices were up by C$0.80 to down by C$3.50 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 C$288.80 per tonne in southeastern Saskatchewan to as high as C$317.10 per tonne in southern Alberta.

Quoted basis levels varied from location to location and ranged from $47.90 to $76.30 per tonne above the futures when 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.

When accounting for currency exchange rates by adjusting everything into Canadian dollars (C$1=US$0.7411) CWRS basis levels ranged from C$4.30 to C$19.90 below the futures.

Canada Prairie Spring Red (CPSR) wheat bids were lower, down by C$0.10 to C$0.60 per tonne, with prices ranging from C$247.30 to C$272.10 per tonne.

Average durum prices lost C$4.70 to as much as C$6.90 per tonne, ranging from C$392.10 to C$407.80 per tonne.

Spring wheat futures in Minneapolis were down by 3.25 cents per bushel in the May contract to settle at US$6.5550 per bushel on Feb. 22.

The Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPSR in Canada. The May Kansas City wheat contract was up by 1.50 cents on the week to close at US$5.7150 per bushel on Feb. 22.

The May Chicago Board of Trade soft wheat contract settled at US$5.7925 per bushel on Feb. 22, up by 12.00 cents on the week.

The Canadian dollar held steady relative to its United States counterpart, closing at 74.11 U.S. cents on Feb. 22.

— Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg.