Option to price into next years pool if you wish

[Jagfarms]

Is any one going to Price this years Durum into next
years pool? What are your thought on this. By the
looks of the pros it does not look good but the pros
can change a lot for next year in next 16 months. I
am thinking I am going to go for it.

New pool pricing on wheat and durum

Current fees

Wheat

Per-tonne fee

Canada Western Red Spring

$3.25

Canada Prairie Spring Red

$11.00

Canada Prairie Spring White

$12.00

Canada Western Red Winter

$15.00

Canada Western Hard White Spring

$3.25

Canada Western Soft White Spring

$22.00

Canada Western Extra Strong

$3.25


Durum
Per-tonne fee
Canada Western Amber Durum
$5.00
These fees are effective from 2 p.m. CT (Winnipeg
time) on February 26, 2010 until further notice. The
fees could change daily at 2 p.m. CT.
Settling current crop year deliveries in the next crop
year
Farmers and landlords who want to price their
2009-10 deliveries of wheat or durum into the
2010-11 pool must complete and submit a 2009-
10 New pool pricing sign-up application between
February 26 and June 30, 2010. Every farmer or
landlord who wants to price their grain into the
2010-11 pool must complete their own New pool
pricing sign-up application.
For wheat and durum, there is a per-tonne fee, a
$25 administration fee, and an advance notice
requirement for farmers or landlords who deliver in
the current crop year and then choose the following
crop year's pool return. The per-tonne fee for
wheat is different for each class. The CWB will
deduct the program fees from any future payments
owing from the CWB to the farmer or landlord. To
pay by Visa, MasterCard, or American Express,
farmers or landlords can call 1-800-275-4292,
with their credit card number and expiry date.
Switching grain from one year to the next creates
uncertainty regarding pool size and affects the pool
returns of both the old and new crop years. The
per-tonne fee offsets these impacts and is regularly
updated to reflect changes in the Pool Return
Outlook (PRO) and market conditions. This fee is
calculated based on the difference between the old
and new crop year PRO, current average sales
values and risk.
If deliveries exceed the tonnes indicated on the
New pool pricing sign-up application, farmers or
landlords will be charged the highest per-tonne fee
posted between February 26 and June 30, 2010,
plus liquidated damages ranging from $6 to $25
per tonne. If 2009-10 deliveries are priced in the
2010-11 crop year and the CWB has not received a
completed New pool pricing sign-up application,
the farmer or landlord delivering will be assessed
the highest per-tonne fee that was posted between
February 26 and June 30, 2010, plus liquidated
damages ranging from $6 to $25 per tonne.
Farmers or landlords can sign up by:
· faxing the application to 204-983-8031
· calling 1-800-275-4292 with their CWB 10-
digit identification number and PIN
· contacting their grain company representative
who can fax the form in; the farmer’s or landlord’s
signature must be on the form
Grain eligible for new pool pricing
To be eligible for new pool pricing, farmers or
landlords must have one of the following CWB
2009-10 wheat or durum delivery contracts:
· Series contract
· Guaranteed Delivery Contract (GDC) - except
for 2010-11 Churchill or Wheat Storage Program
· GrainFlo contract
· Identity Preserved Contract Program (IPCP)
contract
Selected Barley Storage and Delivery Contract,
CashPlus and feed barley contracts are not eligible
for new pool pricing.
Do not use the New pool pricing sign-up
application if the grain was committed to either a
2010-11 Churchill storage contract or a 2010-11
Wheat Storage Program contract.
Grain delivered in 2009-10 and priced in 2010-11
cannot be settled against a 2010-11 Fixed Price
Contract (FPC), Basis Price Contract (BPC) or FlexPro
contract.
Please call the CWB at 1-800-275-4292 for
additional information

[charliep]

I always question the strategy of carrying crop between pooling years
and this year in particular on durum (realizing you will be carrying bins
of durum anyway). Something about comparing average prices between
pooling years never seems right - particularly when cash flow
implications are included.

Logic.

From what we know today, what makes anyone bullish on durum? Lots
of North American durum and expectations for a large carryover. Good
crop conditions across North Africa (still growing so time for trouble
but....). Durum acres will decrease in north America but how much?
How much of a crop disaster (quantity or quality) before this would
catch the markets attention?

I consider grain in the bin the equivalent of money. Is grain in the bin
the best use of money as an investment or can you use it better
elsewhere? Would you be better to sell durum and buy futures (might
be wheat or corn)? If markets go higher this summer, will durum be a
full participant? Can you cash flow grain in inventory?

[charliep]

I should note there is no difference between grain in the bin and a
storage ticket (or this case an unpriced contract). Actually should call an
unpriced contract because the CWB will move the durum out of the
elevator and price it into the pool. Inventory in the elevator system needs
to get sold and moved whether priced by individual farmers or not.

[bucket]

The worst of it is that you have to pay the cwb to carry it to the next crop year.

They lose you 3 bucks a bushel from 08-09 and now the cwb is doing you a favour to send it into the 10-11 crop year and a farmer has to pay for that.

If they represented farmers like they said there would be no fee considering the money they have lost us already.

[TOM4CWB]

Bucket,

'If they represented farmers like they said'... when I am offered a higher price than the CWB will pay me... the no cost export license would be instantly issued.

The CWB supporters want to suck and blow at the same time. They say they Stop me from undercutting the market... but really they only really want to reck my opportunity to sell for more than they can get... from the CWB in the pit.

[bucket]

True enough T4.

But why can't the cwb at the very least acknowledge the money they have lost us and the time they have had to market our durum. Going on three years to be paid and taking a forced loss, should be reason enough to go back to no fee crop year picks.

[TOM4CWB]

Bucket,

There never should have been a fee in the first place.

Kind of like Allied WWII war prisoners' being required to pay for extravagant birthday parties for their guards ... from meager prisoner care packages!