MarketsFarm — Increased worldwide demand for wheat and precipitation across the Prairies have resulted in mixed spring wheat bids for the week ended Thursday.
Scattered showers across wheat-growing areas in Western Canada, as well as the ongoing spring wheat harvest, have brought downward pressure on the markets. The rising Canadian dollar also served to lower bids for wheat.
However, Statistics Canada projected a 34.8 per cent drop in wheat production compared to last year, to 22.9 million tonnes, in its latest new-crop estimates released Monday. The Food and Agriculture Organization (FAO) reported that worldwide wheat prices increased by 8.8 per cent in August.
Canada Western Red Spring (CWRS, 13.5 per cent protein) wheat prices were down $2.20-$8.10 per tonne, according to price quotes from a cross-section of delivery points compiled by PDQ (Price and Data Quotes). Average prices were between $377.10 in southeastern Saskatchewan and $398.80 in northern Alberta.
Quoted basis levels ranged from between $35.90 to $57.60 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 ran from US$299.90 to US$317.20 per tonne. Currency-adjusted basis levels ranged from US$24 to US$41.20 below the futures. If the futures were converted to Canadian dollars, basis levels would be $19.10 to $32.80 below the futures.
Average Canada Prairie Spring Red (CPSR, 11.5 per cent protein) wheat prices were down $2.80 to up $2.90 per tonne. The lowest average bid was $338.40 in southwestern Saskatchewan; the highest was $350, in northern Alberta.
Average Canada Western Amber Durum (CWAD) prices jumped $61.80-$67.70 per tonne, with bids ranging from $765.80 in southern Alberta to $785.80 in northeastern Saskatchewan.
The December spring wheat contract in Minneapolis, off of which most CWRS contracts in Canada are based, was quoted at US$8.995 per bushel on Thursday, 12 cents U.S. lower 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$7.09, down 19.25 U.S. cents.
The December Chicago Board of Trade wheat contract was down 22.25 U.S. cents Thursday from the previous week, at US$7.17.
The Canadian dollar gained 0.49 U.S. cent from the previous week, to close Thursday at 79.54 U.S. cents.
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.