$10 bushel Durum

[nakodo]

If we in canada produce 75% of the world Durum and The CWB has the monoploly why can't they ask a higher price for the Durum that we grow? Will some other countries come in and take over CWB Durum market if they ask a higher price.

If one bushel of Durum can make 42 pounds of pasta and the price of Durum went up $5 a bushel it would not raise the price of pasta very much. When I do the math it would only make a difference of .12 cents a pound for the pasta. People will not stop eating Pasta if the price went up a small amoumt.

If the CWB would say to all the farmers that have permit books that in Aug 01 2004 or 2005 or whatever date they will not sell Durum unless they get $10 a bushel or more. It would give the farmers some time to plan ahead for their rotations and maybe they would not want to seed any Durum that year. If they did seed durum they would have to be prepared to hang on to it for a while until the CWB got $10 a bushel for the durum.

Eventually the price would go up because the pasta producers and the people who eat pasta need our Durum and it would benefit Durum farmers all around the world. Even if they only took 30% of the Durum at $10 a bushel it would better than taking %60 at $5 a bushel. Durum in the bin is just like having money in the bank as long as you can pay your bills.

If the CWB had a had all permit book holders vote to see what they thought of doing this I would go for it.

Would this work? Why or why not?

The only negative thing I think that could happen is every other country would seed more durum and take over Canadas durum Markets. Can they seed good enough quality durum other places in the world to take over the CWB market.

On a positive side other countries and durum suppliers may follow the CWB lead and hold out for a higher price.

[TOM4CWB]

gizen,

Canada's 5 year average numbers,

sales 3.5mmt

Algeria, 1.5mmt
South America 500,000mt
USA 400,000mt

Canada is equal to 55% of export trade.

South America and Australia don't grow much durum yet, FSU countries don't either.

How much can we push Algeria and south American countries till someone else grows durum to replace us?

I would suggest any market that is as small as the durum market is would be supplied very quickly!

I understand the FSU counties increased exports over 30mmt wheat this year, no wonder wheat didn't go up?

But this would be complicating the issue with the facts!

durum prices more than 15-20% will encourage big time production, so if you think long time stable wheat prices can be above $8.00/bu, then your plan would work!

About the only way that would happen would be an Argentinian devaluation of the Canadian dollar to .45/US dollar like Aussies did?

[ianben]

Whenever high prices are mentioned it is assumed this will increase production.
I wonder if this is correct?
Do low prices mean we all try to produce more?
Try for every grain as we struggle to pay the bills.
Does the FSU export 30million tonnes to pay its bills too? I told you before about my cousin who exports high grade UK steel for turbines to Ukraine and gets paid in sunflower seed.
The lower the price the more tonnes he takes.
I am sure the FSU could use most of that wheat and sunseed at home so if wheat was twice the price would they only send 15million tonnes?

There is no food surplus just a shortage of people who can afford to buy it.

If rich countries continue to pay less and less for their food how will the poor make enough to buy theirs?

Wheat at $8 might be good for the world.
As Gizen says it would be insignificant on the price of a loaf or packet of pasta to the end user, but make a big difference at the begining of the chain.

[TOM4CWB]

Ianben,

i know that when I am assured a higher price for my Wheat, Barley Peas, or Canola, I do produce more cause I can afford to!

Top dressing fertiliser, fungicides, better weed control, all these inputs can significantly increase production even after the crop is seeded!

I believe the subsidies are the biggest factor creating higher production, and obviously this is what our governments want!

Or like the Assies, they devalued their currency and are getting the highest price for their wheat in history!

Eating meat is obviously the biggest reason for increased grain consumption in developed countries, 3rd world countries can't afford this western diet much of the time!

Algeria and South America eat durum mostly because of custom and can't afford meat, how much more can they afford to pay for durum?

If you were assured $8.00/bu for HRS and 10.00/bu for durum, wouldn't your cropping plans change if HRS was $5.00/bu and durum were $10.00/bu?

Mine sure would!

[ianben]

Yes Tom I agree you need $8 wheat for $10 durum.
All other commodities would need to maintain their relative prices too.
Then I am still not sure things would pan out as most think.Over production.
If these price increases are allowed to return to Third world and FSU countries as wll as you and me. Will they want to eat better and now have the money to pay for it.More consumers not less which is how it is today
Low prices mean western populations pay less of their income every year on food.
Latest stats over here show average spend has decreased from 20% down to 12% in last ten years.
While the numbers of under-norished continue to rise.
I am surprised you think you could increase production at will. I thought you guys had a drought.
I admit I use every weedkiller fungicide and max fert already, but it does not guarentee yield.Still can get half a crop or no crop at all.

[TOM4CWB]

ianben,

We do have micro climates that could produce more, maybe not every year, but overall average maybe 20-30%

And if we had $10/bu durum irrigation would step up supply in a really big hurry!!!10/bu times 70bu/ac = more than double many other crops!

I think that $7.00/bu durum would almost double Canadian production IF we could count on the price holding next year!

Don't you think it will rain this spring?

I think you would see north American supply double in one year!

Then what we do with twice the durum we could normally use?