Russian Wheat

[TOM4CWB]

Perhaps there is a reason Russian wheat is cheaper!

"Copyright 2010 RIA Novosti
All Rights Reserved


RIA Novosti

June 6, 2010 Sunday 7:01 PM GMT 3

9314362

192 words


Egypt's imports watchdog seizes large batch of Russian wheat

MOSCOW June 6


Egypt's imports watchdog has seized a large batch of Russian wheat over claims it is of poor quality, an Egyptian newspaper wrote Sunday.

Al Masry Al Youm quoted the Egyptian imports control organization's sanitary committee as saying the 61,000-metric-ton batch worth $12.6 million contains more spoilt grain and insects than is allowed by the country's norms.

The importer company has asked the authorities to release the batch. It pledged to pay for grain sifting and to make it conform to Egyptian standards at bakeries that the company said have long been waiting for the Russian wheat.

Egypt is one of the world's biggest wheat importers, annually buying over 5 million tons of grain from other countries, mainly from Russia, which accounts for some 33% of the supplies.

The African country, which purchases grain mainly through private Egyptian companies, bought $700 million worth of wheat in Russia in 2008.

Egyptian sanitary services often complain of Russian wheat's quality, but Russia says the complaints are unjustified.

Russia and Egypt are currently holding talks to develop a single wheat quality certificate, to be recognized by both countries.

June 6, 2010"

[Hopperbin]

That is 5.67 American per bushel. Is that really cheaper than Canadian wheat?

[TOM4CWB]

Hopper,

Have you recently looked at what the CWB pool is offering for 09/10 wheat?

CPS/3CWRS at elevator: $130/t or $3.54/bu

1CWRW = $3.30
1Soft White = $3/bu

2CWRS 13.5px = $4.80/bu

We are down over $100/t... how on earth could the 09/10 CWB pool END UP so low?

Who in the designated area... could grow wheat for $3.50/bu... with the expences that went into the 09/10 crop... well over $180/ac!

What in the world did the CWB do?

THe 2009/10 1CWRW pool PRO at Port; is $177/t... after the price has dropped in half during this crop year... and the 2010/11 PRO... in May is supposedly $178/t at Port!

Didn't THe CWB have to had to be selling lower than the RUssians to sell the 09/10 pool down this far! ?

[TOM4CWB]

THe ruskies got $206/t US

And the CWB on average... selling over the whole 09/10 crop year... couldn't get a better price than the Russians... they are stealing much better quality winter wheat while paying us 'designated area' growers under $120/t CDN...

Who on earth says this 09/10 CWB pool price is a premium price????

I have some ocean front property in Killam I can sell you!!!

[bucket]

The russians probably bought our wheat, got it loaded on boats and had it it resold before the cwb even knew it. It continued its way to the russian customers and the kremlin made an easy 20%. Or maybe the russians kept it and sold them egyptians some shit for more money.

And the f***heads at the cwb went home to sleep all snug as a bug in a rug because they had such a hard day.

BTW tom, how do you think the cwb export program is looking for the 10/11 crop year and how do you think they are trading the upcoming crop considering its looking pretty dismal?

[Hopperbin]

Bucket that grain had too many spoiled grain and insects. Lets not say it was our grain. We just want the price it was purchased at plus the premium that we deserve.

[bucket]

"or maybe the russians kept the grain themselves and sold the egyptians some shitty grain"

What is the difference, the russians still outpriced the cwb.

This year the cwb is going to be begging farmers to deliver high quality grain for those premium customers. Its too bad those high priced salesmen at the cwb can't understand what it takes to grow the best quality grain in the world. Offering peanuts for it doesn't cut it anymore.

They are going to be wishing they still had the 09 crop that they just finished giving away.

And I also believe that mother nature just took care of the durum problem as well. Another give away.

Bruce burnett should have been watching this problem with the weather, after all he is the director of weather survellance.

[cityguy]

206 US cif
55 panamax freight
10 west coast elevation
141 US/mt track west coast
148 cdn/mt track west coast
95-105 Cdn mt country elevator bid
$2.60-$2.85 Cdn bu.

Should the CWB step in and take over the sale?

[TOM4CWB]

Cityguy,

The CWB already did give it away... at lower values than you quote... to end up with a 09/10 1CWRW pool value at $115/t... Ocean Freight could have been done for $40/t... east of west coast earlier this year.

[cityguy]

Could be reading it wrong but isn't the latest old crop PRO for 1 CWRW $177 track west coast or about $127 in the country. Will accept your $40 as at one time being the value for freight which makes track worth 156 US or $164 Cdn. Not that it's a great feat but presumably basis your freight values it would appear that the CWB managed to sell something at a premium compared to Russian wheat to Egypt if the old crop PRO is indeed 177.

[TOM4CWB]

Cityguy,

If the CWB had any brains... they would have been selling this grain last spring/summer. That is what pools are supposed to be... selling over 18 months. The CWB says they are supposed to be 95% sold by the end of June for the 09/10 pool.

On top Egypt takes almost exclusively soft red wheat... which is of much less value than our HRW.

If the CWB sells our HRS/HRW to compete with soft red... we are really dead in the 'designated area'. Is that what you suggest the CWB are doing? What 'premium' are you suggesting they actually achieved? Are your prices for HRW ordinary... if they are they do not in any way line up with average prices paid US HRW growers over the past year!

[cityguy]

Tom -

You are right that if the CWB were selling into Egypt then they've completely lost it. It's just that in this thread it was being implied by others that the CWB was getting outpriced into that market by the Russians and that was a bad thing. Even worse, some were suggesting that the Russians were buying Canadian wheat and selling to Egypt. Huh??? There has been some Canadian wheat sold to Egypt this crop year - Ontario wheat, but not western wheat.

As for Egypt, they were primarily a US soft wheat home - 15 years ago. The US had all sorts of credit deals and such plus GASC was the major buyer. Over that time that's mostly changed with credit not in the mix so that soft wheat demand has been replaced out of Europe. However, the demand for hard wheat has increased significantly over the years as the privates have taken over a greater part of the market and that's the demand that the Russian program has taken over.

What's an interesting point is what percent sold should the wheat board be sold. Think their last PRO had then something like 3% sold right now with an aim to be 25% sold by the end of September. As a comparison the US open market has about 20% of their projected export sales on the books right now as the combines roll. What percent sold should the CWB be when the Canadian combines roll, whenever that may be? Is 20% too low, is the CWB's 25% about right (though that % goes up each day given the direction our crop is going)? Or should they be 50% sold on the basis that they have 18 months to market and harvest is about the half way point of the marketing cycle? In the short term you guys are stuck with their decision so what's your advice to them? And recognize that you can always do something for futures/options on the side.

[bucket]

Considering the current crop conditions maybe the cwb ought to wake up prior to any sales are made.

[cityguy]

A broken clock is right twice a day so maybe asleep at the switch is the right plan for right now.

[Choice2U]

Therein lies the problem with the CWB. It is hard enough evaluating the world market and developing a marketing plan but now we have to add in a guess of what the hell the CWB is up to. Did they sell based on moving a big crop (volume) or did they sell to maximize price and carry over more? Now, I'm supposed to guess which was their priority, whether they were consistent with that attitude through the year or did they change part way. With all this BS up in the air, I now have to make my farm work with a FPC or basis contract or stick with the pool. What a pile of crap!!!! It all goes back to trusting their decision and I hate letting someone else make decisions for my farm.