CWB PPO Radio Ads

[TOM4CWB]

charlie,

I was disturbed to hear CWB ads asking farmers to call in about PPO flat pricing options.

As discussed in previous topic messages, it is clear the 2002 "improvements" are at least confusing, and create additional risk which scares away producers.

Does the CWB really expect radio ads to fix the problems with these contracts?

Wouldn't fixing the contracts and offering decent risk management tools be a better solution?

[charliep]

Just a note to highlight that Lee Melvill (Brooks), Neil Blue (Vermilion), Dave Wong (Grande Prairie) and I (Charlie Pearson) can do presentations to groups on the new CWB producer options. The objective would be 1) explain the mechanics (how they work), 2) some analysis on how they might have performed in the past if they had been available and 3) strategies than can be used in the coming year.

[parsley]

charliep
Who would hire you to do this work and who would pay you?
Parsley

[charliep]

AAFRD market specialists will work with anyone who is interested in more of an explanation on the CWB PPOs. Just from a time perspective, it is easier to work with groups (better discussion exchange of information as well). Our time is a part of AAFRD extension activities. Costs of facilities/anything else is normally picked by who ever is arranging the meeting.

Our objective is not to be pro or con this program but provide information so farm managers can make informed decisions.

[melvill]

Last May and June, Vic Schapansky, CWB Farm Business Rep, and I spoke about the CWB PPOs at eight or nine meetings throughout southern Alberta. They were sponsored by a group of grain companies and advertised quite widely. Our turnout was about 50:50 grain co. staff/farm managers. I would guess the average attendance at each meeting would have been around 15 to 20 people. Producers came because they wanted more detail but most weren't very interested in forward pricing wheat much before harvest and yet that's one of the tools that can be used to manage price risk. My sense from most producers was that they consider production risk to be a bigger threat to their farms than price risk, especially since CWB pooling is already a form of price averaging. (That should get some response!)

[parsley]

melvill
Sounds as if you and Vic would work together like two peas in a pod.
parsley

[melvill]

Good morning, parlsey. Not certain what you mean by "two peas in a pod".

Vic and I working together worked very well. Vic knew enough grain co staff to wrangle money from them for hall rent and donuts, etc.

We saw our job as providing as much detail as we could about PPOs to producers and grain co staff so producers could make good decisions about potentially using them. Some producers like the idea but our reaction last year from a great many producers to the CWB PPOs was that they, indeed, were not interested in any form of guaranteed price/guaranteed delivery like what the PPO offered. Many people won't like this but quite a bunch of producers who do not have a market bent, like the pooling system because it does allow them to concentrate on what they like or are most comfortable with - production.

[TOM4CWB]

thalpenny,

Is there any way to contract CPS / CWRS with the option to deliver either or in the tonage using the day it is locked in as the price for either?

Eg.

I have 500 ac of CWRS, and 500 AC of CPS. We all know the CWB price for feed wheat is unacceptably low... so if I end up with feed wheat in either class, I need the option to switch the tonnage to the other class... hopefully getting milling grade out of one of the classes.

So if I wanted to do a basis, I need the option to switch once, between the CPS and CWRS basis programs...

Another option would simply be to give the option of using the CWRS basis on my CPS like you did in 2001-02... and when increasing intials keeping the spread in line with current PRO values, like the last initial adjustment for 2001-02 you did...

How do we get more flex back into the PPO options for 2002-03, like you had in 2001-02?

[TOM4CWB]

Thalpenny and the CWB,

Don't recent CWB actions, wrecking the PPO system, make the radio adds you spent our hard earned money on a waste?