The short-term uptrend seen in wheat markets continues: It's a combination of increased demand as consumers stock up on staples due to the coronavirus scare, while supply chains around the world are being tested.
Spring wheat has lagged the lead seen in winter wheat futures, with the nearby May contract increasing 27 1/4 cents or 5.4% from its recent low to Monday's close, while hard red winter wheat has gained 16.5%, or 69 1/2 cents, and soft red winter has gained 14.4% or 70 3/4 cents.
At the same time, selling opportunities may be considered when a combination of futures strength and Canadian dollar weakness are taken into account. For example, since the close on March 16 when the recent low of $5.03/bushel on the May spring wheat chart was reached, the future has increased by $6.80/metric ton in U.S. dollar terms, but by $19.94/mt in Canadian dollar terms, using the spot dollar which dropped by 4% over this period.
In Canadian dollar terms, basis is seen weakening over this period, which could be viewed as a concern and a signal that the underlying demand is not behind the move higher in prices.
PDQinfo.ca's No. 1 CWRS 13.5% protein bid reported for the nine regions of the Prairies for March 23 ranges from $233.52/mt for southeast Saskatchewan to $251.36/mt for southern Alberta. The trend for southwestern Saskatchewan is shown on the attached chart as of March 20 (blue line), with the March 19 bid of $240.52/mt ($6.55/bu.) the highest reported since June 2019, while only slightly higher than the $238.35/mt reported for March 23.
Cash prices for durum are reported to range from $277.36/mt in northwest Saskatchewan to $296.04/mt reported for western Manitoba, according to pdqinfo.ca's March 23 report. In the case of the southwest Saskatchewan bid of $278.30/mt, this comes within $0.02/mt of a price last reported on November 2017, while below the highs last reached in August 2017.
It is important to note that prairie bids will vary by delivery point.
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