Think outside the bin

[checking]

Some of us won't participate in targets and tonnage requests, Ianben.

As I see it, targets give buyers too much information, and that is not in my interest to provide more than a second forward in time. I'm not a Wal-Mart store with a price tag to see on each item.

Lots of my neighbours, however, love them as they say they haven't the time in a day to follow markets, enough of a volume to worry about, or the patience to wait for unseen circumstances that usually present themselves to drive prices beyond their target.

Target prices, however, are splendid devices for grain buyers to fill their needs. I absolutely know why buyers love them, as there is no guess work, or incentive on their part to go beyond a group of targets that fill their orders.

The lowest price is the law - I've heard!

[Hopperbin]

The target price is a contract signed with a grain buyer like I said before a certain amount of tons for a certain price and also a delivery period with understanding of what quality or even moisture. What I like about it is often grain buyers give hints as to what targets are hitting. Unlike Checking who does not like to use targets I like them and 90 percent of the time will price higher than current offers. I still watch the grain prices especially if I have a target. The reason being I want my target to be at least .25 to .5 dollars per bushel higher than the market. Also I have had my targets hit above my asking price say if the general offered price for the day comes out higher than my target they will give me the higher price. I tell you I come back to these grain buyers. I have no problem with this open market system. I don't think you need to have a lot of grain either to use them, my tonnages are usually only 5 to 10 thousand bushel lots but can be anything really. It is convenient for the buyers I believe as they need to make the sale on the other end. I believe it takes some risk out for the grain companies. which can work back to your favour. I can withdraw a target price at any time or increase decrease tonnage or price. To use these targets successfully I believe one must watch the market also daily to be more successful. One last thing if I offer say canola 9 dollars per bushel for the next week. In 2 days if the price rises I can increase my target, withdraw my target all together all options are in the farmer's hands until the target is hit, in which case the buyer phones you and tells you and the sale is done.

[cottonpicken]

Been trying to figure your angle for a while chaffy,someday i will.

50,000 sellers and a few dozen buyers=everything a o k

in your world

not mine

My farm was growing wheat before the board,the reasons it was brought in should not be forgcotton.
Things dont need to stay the same butt...
The problems will be overcome by farmers united not divided.


Lots of sharks looking to CAPITALIZE of someone elses sweat.What can i sell ya?What your sellin i dont need that bad,unless its cheap.

[cottonpicken]

And before the bla,bla,bla comes out of your mouth chaffy,please explain last years fertilizer cun un drum!

The non sencsical drivel about free fair market dynamics in ag is the fecises that some people need their nose rubbed into and hard.

Lots of sellers few buyers=lower prices

Do some people need me to draw them a picture?

Or do some here want to put money in their own pockets at farmers ignorance?

[Zaphod]

Bottom line is that crops where there is competition (canola, peas, lentils) are getting bigger. Wheat and barley acres are getting smaller. What does that tell you? Which system is working better? Hmm. I call no-brainer.

[may-be]

Hit the nail on the head zaphod.

[charliep]

Perhaps one of the main benefits of the internet is the ability to gather more information and make better decisions.

Better information on current prices both local and at final customers destination. Farmers may not like the price but but it is more readily available for all to see.

More ability to do things to drive expenses out of the supply chain. A start is the ability to deal direct with processors or at least limit the number of intermediaries that add expense to the system. Perhaps a further benefit of dealing more direct via the internet or some other route is better communication on the buyers needs and ability to satisfy them better and get paid for it.

One other thought is to actually increase the level of competition by adding to the list of buyers that will potentially buy from a farmer. There are transaction risks in that you may not know them/may be issues on delivery, etc. but your customer base can increase.

Realize this is theory in that most farmers just believe they grow a commodity with one price and it someone elses responsibility to market it for them. Perhaps your original posting and title is to get people to think different/look at ways of achieving more value. Will note cottonpicken's hitting the mother lode on a mutual fund. Took research and risk taking but the rewards were there. No reason the same thing can't be done (hopefully not as a speculator) with agricultural crops.

[chaffmeister]

CP

1. Never said everything is a o k. I comment on what doesn’t work. And I give my view as to what is needed to make it better. A OK? You’re kidding, right?

2. The “second” CWB was established in 1935 to oversee (and provide a vehicle for the feds to financially support) the failing farmer cooperatives, like Manitoba Co-operative Wheat Producers Ltd (of which my grandfather was a founding member.)

Why is that important to remember?

3. I make the distinction between the CWB and the single desk. The CWB as an institution has its short-comings but it’s the single desk (mandatory monopoly) that is the real problem. Make it voluntary.

4. Uniting farmers – great idea. Like SunKist, like Ocean Spray. Just make it voluntary and do such a great job for those that join that you won’t have to promote it.

5. Not sure, but it sounds like you’re accusing me of being a shark looking to “put money in their own pockets at farmers ignorance”.

There are far too many farmers that are “babes in the woods” when it come to understanding how the grain business works. Even worse, they don't know how to work it to their own gain. Unfortunately, there are too many “market gurus” out there that don’t fully understand it either. Go ahead and trade – pick your tops and bottoms. But if you think that’s all there is to it, you’re missing out. Better information (via internet) is a good start. Understanding the business is just as important.

I can make more money with smart farmers. That’s why I share.

6. It’s “feces”, not “fecises”. You’ve got spell check – use it.

[ianben]

Thanks Hopper

Dont think anyone is offering targets here least not to me.

Looks usable but I gather your target is with just one buyer?
The ebay buyitnow type option would be like target with any buyer you then choose.

Checking would that work for you if buyers compete.

Been outside the bin today thinking from the otherside.

If a guy had some land for me to rent what would I want him to do?

Pretend he didnt till 15th June and then, want me to offer top dollar, for a three month term.

Let me hear a whisper, expect me to contact him, want top dollar for a yearly term.

Ring me and offer me the land at top dollar for five years.

Which would you choose?

checking
I'm not a Wal-Mart store with a price tag to see on each item.

I am not either but would sure like to be.

I would like to provide a sevice to my customers,grain buyers, by having my bin full of the exact product they required and the knowledge that should they require more in the future it will be available at a similar price.

At the moment we are at best like the first two guys with land to rent but we know the only deal we want is the third.

It is just worth so much more and allows us/them to plan and invest.


burbert
Most farmers and have experienced the cheating and lying in the market, when buyers downgrade, grain they are purchasing.

A real lack of understanding on both sides here I find.

A few of my own experiances.

Dockage never explained but further explanation can be gained.

Most of my moisture claims have just been the extra water I have delivered.

The excessive bushel weight claims one buyer demands is because his mill cannot work fast enough with low bushel grain and under the present system this is the easiest way to stop farmers delivering it.

The Spanish millers are giving UK wheat a £2 premium over French while actually paying us £2 less, because the average moisture content of UK wheat delivered is 14% and French 12%. The spanish miller did not expain this without questioning as he though we would know. Most UK farmers still think we get £2 less Spanish bast****.

Lots and lots of opertunities being lost on both sides through the ineffiecency of the current system.

[ianben]

Cotton
50,000 sellers plus a new marketing system and a few dozen buyers=everything a o k

explain last years fertilizer cun un drum!

Farmers get more money fertilizer everything else we buy will will go up.

Whats the problem?

Our suppliers are not doing that great either they get bigger to survive not because its a gravy train.
Dont you want them to make a profit invest in R and D be there next year to provide you with a service?

Our prices fell thats the problem.

Think outside the bin!

[ado089]

Locally grown hard red spring wheat for sale, hundred mile diet certified, perfect for bread making. $5/lb Please leave msg.


Chaffy, where do you get some of these ideas? Of course there is a finite amount of wealth in the system. If there wasn't the concept of wealth it's self would not exist. Are we extracting it all? Probably not. I don't think there's a farmer out there, no matter their marketing beleifs, that expects everyone else in the chain to operate at zero profit. But it is a big pie, and yes could be bigger, but and slicign it up and leaving the crumbs to the farmer is where the problem lies, and that how the system, both board and non-board crops works right now. With that said there's only one place in the chain that a bunch of poisson, dirt, diesel and hard work is turned in wealth, the rest is just value adding. Figure it out and cut one more slice so everyone can have some.

The CWB, although not made permanent until 1935, has origins prior to WWI when farmers who felt that they were getting screwed by the system unified to say enough is enough. That led to the grain commision, the provicial pools and eventualy the CWB. We're no longer unified and the provincial pools are gone. Two down two to go and it's just like the wild west again. Funny how way back then there at least 10X more farmers and next to zero communication and information flow, yet they were able to come together, agree and change their reality. I think even those clowns in 423 main have forgotten this lesson.


Seriously though local processing would be a great first step and one marketing option that should be 100% free of the CWB.

[ianben]

ado089

Seriously though local processing would be a great first step and one marketing option that should be 100% free of the CWB.

Even without the CWB how can you offer that 5yr lease equivalent most of these projects require to commit investment.

Carling/Coors want this from me in malt barley but the Market will not allow them to commit on price.

Not because they want to screw me.

The opposite they want the assurance that I can provide their raw material,and understand the margins are not great.
Their worry is the Market might give their competition Calberg/Fosters an advantage over them should the market fall.

Isnt this why farmers dont co-operate more other farmers are competition.

The difference is Coors Calsberg and Fosters dont compete on price like us they monitor each other price and compete on sevice and quaility.

Exactly what an internet marketing system would allow farmers to do. Take the volatility out of the system and watch the oppertunities explode.