Canadian wheat prices hit their highest level in more than two years

Prices for Canada Western Red Spring wheat climbed to their highest level in more than two years after a sharp rally in Minneapolis spring wheat futures driven by escalating tensions in the Black Sea. As of July 17, Platts assessed Canadian wheat at $307.46/mt, up 5.5%, or nearly $16/mt, from the previous week. The price was last higher at the end of May 2024.

The rally was mainly fueled by a more than 6% increase in December Minneapolis Hard Red Spring wheat futures. Growing concerns over grain export disruptions in the Black Sea supported global wheat markets and raised fears about international grain logistics and supply.

Despite the futures rally, Canada’s physical market reacted much more cautiously. Market participants said cash basis levels changed little as buyers and sellers assessed whether higher futures prices would be sustained. Several traders expect basis levels to gradually weaken if futures remain elevated.

Farmer selling remained limited despite stronger prices. Producers continue to hold old-crop wheat because of concerns about the quality of the new harvest. Persistent rainfall across Alberta and Saskatchewan has increased the risk of fusarium, while wet conditions have prevented timely fungicide applications.

Farmers are also retaining limited stocks of high-protein old-crop wheat, expecting it may be needed to blend with lower-quality new-crop supplies if protein levels disappoint. This has continued to support nearby old-crop premiums, although market participants expect grain supplies to increase as harvest progresses, which could gradually put pressure on basis levels later in the season.

Tags: prices, Canada, wheat