Canadian wheat stocks soar even faster than expected

06.02.2017

Spring wheat prices in Minneapolis edged lower, following the news that stocks of wheat in Canada grew even faster than expected.

But spring wheat prices continued to grow their premium to Chicago-traded soft wheat, reflecting a tight global market for high-protein wheat.

Canadian wheat stocks, which are mostly spring wheat, surged 16.8% year-on-year, to 25.0m tonnes, government data showed.

These figures beat trade expectations of 24.2m tonnes.

Tight spring-wheat market

But despite the bullish figure, the fact remains that world markets for high protein wheat, of which North American spring wheat is the hardest readily available, is very tight.

"The spring wheat market has the lowest stocks to use of the different wheat classes," said Joe Lardy at CHS Hedging on Thursday.

"Exports are at a recent high and food use is at a record high level."

Minneapolis edges down

And Minneapolis spring wheat futures continued to recover their premium to Chicago.

Minneapolis spring wheat was down 0.1%, at $5.60 ј, in mid-day deals.

March spring wheat futures in Chicago where down 0.3%, at $4.33 ј a bushel.

Durum stocks soar

Stocks of durum wheat, the hard variety used in pasta production, rose 63% year-on-year, to a record 6.9m tonnes, above expectations.

But stocks of canola shrunk some 10% year-on-year, to 12.2m tonnes, in line with expectations.

They are the smallest year-end Canadian canola stocks in four years, thanks to brisk exports and domestic use.


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