CWB has released updated Pool Return Outlooks (PROs) for the 2014-15 Annual and Winter pools and Futures Choice pools. Compared to the last PRO released in November, wheat projected returns are higher across all pools, while projected returns for durum are lower across all pools. Projected returns for canola, field peas and Futures Choice pools remain unchanged.
Wheat futures prices continue to strengthen as a result of uncertainty over Russian winter wheat exports. Overall, the crop conditions of winter wheat in the U.S. and Europe remain in good shape, while there is some concern over the dryness in Russia. In the U.S., exports remain strong. Current Minneapolis wheat futures prices for the March contract through to December 2015 are trading in the range of $6.60 to $6.90 per bushel, which are up significantly since the last PRO. Combined with the impact of a weakening Canadian dollar against the U.S. dollar, the pool returns have increased.
Given current PRO assumptions, farmers in the 2014-15 Futures Choice Annual and Winter pools can expect to achieve a final return for 1 CWRS 13.5 in-store port position made up of the March 2015 futures value they lock in plus $30 and $35 per tonne, respectively.
Durum markets continue to decline due to buyers adjusting to the lower quality durum supply this year. The Canadian dollar has also been weakening since the last PRO release. Overseas, recent rains in Algeria, Tunisia and the Mediterranean have been beneficial to the development of the durum crops. Overall, the projected pool returns have been weakening.
