Pooling in Australia

[malleefarmer]

Seems as though moves are being made to
tighten up regulatory financial services
legislation regarding pools in
australia.

at the moment they are exempt from any
scutiny ie they post a pool price and it
doesnt matter what the return is if its
$30 above estimates or below.

Some of the estimates are pie in the sky
stuff and inflated to get growers to
commit, some companies estimated pool
are quoted right up to few weeks before
finalization the sort of say sorry we
couldnt achieve it bad luck.

Its something you guys in canada will
have to look at. Also costs of running
pools is getting investigated sometimes
it works out at as high as $30 per tonne
thats a fair bit per acre.

I guess its all in hindsight but really
shows after 3 yrs of open market here
how pooling had a fair bit of smoke and
mirrors and only really did work in
years of rapidly rising markets

[wd9]

I think its awesome there is still the CWB
here to take farmers money with pooling.
Helps me be more competitive.

[wilagro]

wd9: Are you one of the "big" competitive farmers dominating the WEST now?

How do you define your competitiveness? Are you competing with other farmers to supply quality and quantity or competing with other farmers on how low you will go on price received or asked for by you?

Competitiveness has many faces depending on which side you are on. It can be good or bad. One who is competitive with every aspect of living is probably an insufferable jerk.
Here is an opinion piece that I found interesting:

http://digitaljournal.com/article/329473

The old co-operation amongst farmers in marketing their grain has now been supplanted by the competitiveness of today's modern farmer and some of the politics involved.

[wd9]

Nope, i would be considered a small
farmer. But all farmers are in
competition with each other, for rent,
contracts, land, machinery etc. If i
make a bit more than all the rest, i
will be more financially better off and
secure. Its not unique to farming, but
to every business and industry on the
planet.

Those farmers signing up with a the CWB
are pretty much guaranteed to make less,
and that's just math.

[ProFarmer]

Local elevator managers says nothing signed up at two large local elevators that they know of.CWB dead in the water.

[hobbyfrmr]

profarmer, i have heardthe opposite. the bto's
around here have not signed up much wheat
with open market because they are concerned
about thee discount spread not being disclosed
by the big grain co's. much of the wheat around
here is high yeilding ethanol wheat not hard red
spring.

[BreadWinner]

Most producers in my area are waiting to decide till the grain is in the bin. There can be to many variables in the price if you dont know the grade and protein. Dont know anyone singing up for pooling.

[wmoebis]

I haven't talked to anyone (although I'm sure there is some) That have signed anything board or non board. It was stated on here that there was big sign up on the open market, the day the single desk was lost. Not sure how much truth to that?

The most I've talked to are wait and see on quality and protein. I would think the days of blending for grade inprovement on producers behalf, at the elevator, on contracted grain will be less. I think we will hear more of It is what it is.

For me I want to try ship at the bottom of grade and know what my protein is so as to blend to hit bottom of contracted level.

The other thing I wonder is, how many producers are thinking of shipping straight into the USA if grade is lower? It has been advocated on here that the US. gives #1 for everything.

[charliep]

I suspect there is at least some old crop inventory being delivered into an open market.

Also a lot of old crop CWB/single desk inventory in the elevator system. There will a final tally on how much is in system carried over from 2011/12 and the transition over the next few months from selling from old world stocks delivered under CWB single desk and new world of an open market. Long term customers will still have need to buy Canadian wheat over the next 2 months while new crop comes on the scene.

Indication is that a unit train of feed wheat has been put together and is moving south to Texas to replace expensive. Watch for more generic business into feed markets.

[charliep]

wnoebis

I don't know if you could call the wheat that moved into the US lower quality. They measure quality from end use characturistics versus our grading system and this has created opportunities over time. Still have to know what you are delivering (including things like falling number) and understand the market down there/fit of the grain being delivered.

[malleefarmer]

having said this most farmers still pool
some grain maybe 15 to 20%.

there are a few innovative pool products
around the place and couple of companies
consistantly provide healthy returns
within there estimates.

domestic pools work ok as do "special
milling grade pools"

now that cargills have awb there pools
are much better and on the face of it
have far reaching market power and
seemingly alot more markets and they
took a broom to awb and went through the
place like a hot knife through butter.

dont get me wrong pooling is not dead
just the whole pooling system is getting
a shake up it probably needed as i said
before you guys in canada can set up a
perfect system if you look and learn

[wmoebis]

100% agree Charlie, Knowing quality will be the Ace in the hole and if one has to blend at home to make that last buck or two, so be it. But one should know what they are doing and how to properly assess quality.

I guess if you don't know your quality you can have your buyer tell you what you have for sale! or at least get third party assessment. There is alot of money left on the table by not selling at the bottom of the grade.

It is funny how everybody thinks they grow the best and then everyone elses lower quality is blended in to give them the benifit. This maybe right in some cases but nobody admits that they grew the lower quality and got a break or not. lol.

My US statement was in referance to the statements that producers were being laughed at in the USA when they told them they were getting down graded for certain detriments that it would have been #1 there and that maybe some are waiting to feel that market out. Might be a good idea.