100 % Acceptance on "A" Series Contracts and GrainFlo

[charliep]

The CWB has taken 100 % of the wheat and durum offered it under the "A" series contracts including identity preserved. They have also taken 100 % of the grain offered under GrainFlo.

[cchurch]

Son of a bitch.

[fjlip]

Must have gave that much away boys!

[furrowtickler]

Must be election time, hopefully the fpc's stay within reality. Still don't trust the pro's regardless of what they say.

[poorboy]

My cwb rep said there was almost no feed wheat signed up on the A series. Something like under 2 million tonnes.

After hearing all the stories of poor quality grains from a lot of areas, it was a total surprise how small the sign up was.

[silverback]

Who would have signed their feed wheat on the A series with the way the market has been going and with no idea when or if they will take delivery? Initial payment is still what? $2.12/bu?

The problem is not the volume of feed wheat out here, it is trying to decide what to do with it.

[charliep]

Why would anyone signup for an initial payment of 75 cents/bu? Suspect the way the CWB will get commitment on feed wheat is Guaranteed Delivery Contracts. Hopefully the CWB will show creativity by some form of grain pricing contract, guaranteed delivery contract with an early payment value, etc. Based on current international feed grain prices, there is no reason the CWB shouldn't have a price of at least $5/bu right across western Canada.

[silverback]

I apologize, $2.12 is before deductions.

Need more coffee.

[poorboy]

Everyone knows it is going to be more than 75 cents a bushel.

You can sign up for the EPO on feed wheat today and have a decent minimum price contract. Every day that wheat futures rally, the cost for the EPO drops. Feed wheat EPO's do not have the risk of losing money when the initial prices increase.

Or the FPC is available, but there is a risk of losing money when the new initial prices are released.

Slower the CWB is taking feed wheat the lower the domestic market price will be.

[charliep]

Actually if 2 mln tonnes (should have looked closer poorboy), this would be a significant volume. The next stage will be the export program and getting the logistics into place to make it happen.

Even with the $70/tonne adjustment, feed wheat will still only be $148/tonne at port or $85 to $95/tonne local elevator ($2.50/bu ish). A farmer has to use the programs to increase this value cash flow wise. Why just a price at the elevator and a GPC/GDC with EPO as standard feature?