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Prairie wheat bids rise as dollar falls

Winnipeg, March 5 (CNS Canada), Mar 05, 2018 (Commodity News Service Canada, Inc. via COMTEX) --

Most wheat bids in Western Canada rose over the week ended March 2, following the lead of the United States futures and taking strength from a weak Canadian dollar.

Depending on the location, average Canada Western Red Spring (13.5 per cent protein CWRS) wheat prices rose in Western Canada by C$1 to C$5, according to price quotes from a cross- section of delivery points compiled by PDQ (Price and Data Quotes). Average prices ranged from about C$239 per tonne in southeastern Saskatchewan, to as high as C$254 in northern Alberta.

Quoted basis levels varied from location to location, but rose to range from $11 to $16 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 Canadian prices to U.S. dollars (C$1=US$0.7757) CWRS bids ranged from US$185 to US$197 per tonne, which was down on a U.S. dollar basis on the week. That would put the currency adjusted basis levels at about US$31 to US$43 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$40 to C$55 below the futures.

Canada Prairie Red Spring (CPRS) wheat bids rose across Western Canada by C$8 to C$12. Prices across the Prairies ranged from C$207 per tonne in southeastern Saskatchewan to C$224 per tonne in southern Alberta.

Average durum prices were mixed with some unchanged and others falling by a dollar or rising by a dollar in most of Western Canada, bids ranged from about C$255 to C$265 per tonne.

The May spring wheat contract in Minneapolis, which most CWRS contracts Canada are based off of, was quoted at US$6.2025 per bushel on March 2, which rose by seven U.S. cents from the previous week.

The Kansas City hard red winter wheat futures, which are now traded in Chicago, are more closely linked to CPRS in Canada. The May Kansas City wheat contract was quoted at US$5.3375 per bushel on March 2, rising by almost half a dollar compared to the previous week.

The May Chicago Board of Trade soft wheat contract settled at US$5.00 on March 2, which was up by almost 36 U.S. cents on the week.

The Canadian dollar settled at 77.57 U.S. cents on March 2, which fell by 1.37 cents over the course of the week. The loonie was dragged down by global fears of a trade war after U.S. President Donald Trump announced he will impose tariffs of 25 per cent on imported steel and 10 per cent on aluminum.

Ashley Robinson, Commodity News Service Canada

Copyright 2018 Commodity News Service Canada, Inc.

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