August PRO - Pay Attention

[charliep]

Sorry for missing yesterday.

Grain values rise significantly in latest CWB PRO for 2010-11
August 26, 2010
Winnipeg -- The CWB today released its August 2010 Pool Return Outlook (PRO) for the 2010-11 crop year. Wheat values are up between $33 and $53 per tonne from last month's PRO, depending on class, grade and protein level. Durum is up $33 to $41 per tonne. Malting barley has increased by $46 and feed barley values are up $66.

<a href="http://www.cwb.ca/public/en/newsletter/updater/082610.html">August PRO</a>

[charliep]

I will keep my rants to separate so they can be treated for what they are. As a matter of frustration for me, why does the CWB keep to the 4 th Thursday of every month? Tradition? Laziness?

The reason this boils my blood is all their the producer payment option prices are related to the PRO in some shape or form. Early payment options - what impact on premiums does this have signing a contract the day before and the day after a major increase like this? You should be able to sign an EPO on any day based on the market that day without worrying when the next PRO will be released.

In all reality, the CWB has to look at a new system other than locking in everything relative to the PRO. The PRO should simply a forecast no different than what Ag Canada/Charlie Pearson on market side or David Phillips/Drew Lerner on the weather side. Yet the PPO are directly tied to the PRO which is about as responsive to markets as a rock at the bottom of a swimming pools. Why?

[charliep]

Sometimes I should look before I rant.

An 80 % EPO yesterday after the PRO (1CWRS 13.5) which locked in a payment of $222.40/tonne (port) would have cost $7.12/tonne. Previous day (old PRO), a 100% EPO would have cost $7.55/tonne.

In my defense of foolishness, I note no farmer has had the ability to participate in the $63/tonne increase in the PRO via the EPO.

[charliep]

The 100 % EPO on August 25 would have locked in $225/tonne.