Early Payment program for all classes of wheat

[cowman]

The CWB has expanded the Early payment Option to include all classes of wheat (except durum).

Farmers must sign up the tonnes before Nov 29/02. All grades except sample and mixed are eligible.

This program will give you 90% of the PRO (less discount for admin, time value of money and risk) just after delivery. You are still to any and all adjustment, interim or final payments over the EPO value you selected.

The CWB will be announcing the Early Payment value daily starting August 1 through to Nov 29. If you sign up tonnes, but don't lock in an Early payment value and discount, the Nov 29 value will apply.

This may be a very useful, low risk way to improve cash flow this fall. (For those fortunate enough to have marketable crop...)

You can get the fax acceptance form from country elevators, or call 1-800-275-4292.

Tom

[Kasro]

Tom, thanks for your notification. And I notice that you have managed to stay with the script. You haven’t been caught up in the discussion others are having about markets, wheat prices, and farm management.

For other participants in this forum, you are tying yourselves up in knots over what the CWB is doing, versus what we farmers want. Don't get caught up in the illusions the CWB is purveying. You want a functioning market. The CWB wants anything but. They do however, want you to THINK they are giving you what you want.

Choice, options, contracts, pricing…these are all words that we normally use when discussing markets. But notice that the CWB also uses them. Except they create illusions because their meanings are not the same as everyone else’s. Some people try and revise history. Others revise word meanings. Some even do both.

Don’t forget the PPO stands for Producer Payment Option. It is not Producer Price Option. It is not Producer Market Option. It is a payment for your grain. It is not a market price.

It is abundantly clear to me that the CWB is not interested in farmers receiving market signals or market prices. After all, price pooling is the antithesis of that. Pooling is meant to mask market realities, and blunt price changes and signals over the period of the pool.

It is therefore a complete waste of time to try and figure out how the PPOs work vis-à-vis the real wheat or barley market. They are not meant to. And the CWB doesn’t want them to. All they want is to give farmers some “payment options”, governed by their PRO…….which many have rightly pointed out is, again, not market driven. It is driven only by the CWB’s performance in the market. Quite a different thing.

The only solution to the poles apart vision of how and what farmers’ roles are in producing and marketing wheat and barley is defeat the directors of the CWB who favor market isolationism, and replace them with others who wish to operate in the real world.

[parsley]

The most prominent characterisitic these Directors represent is not market isolationalism, Kasro, rather it is coercion and force in the marketplace. Jail if you don't go along with single desk. Fines if you don't agree with monopoly.

Not my idea of what I look for in a marketing partner.
Parsley

[charliep]

Tom

Are there maximum tonnages that can be signed up? How is risk handled that the CWB EPO offering is above the actual total payments?

A good alternative for those using pooled pricing. Given initial payments were likely based off the June PRO, look for initial payments to be extremely low (practice is that initial payment is 75 % of the June PRO) - as always will be adjusted relatively quickly in the fall if markets warrant.

[TOM4CWB]

Thapenny,

What percentage of expected 2002-03 wheat production that will go to the CWB, was presold on hedged before June 27th, 2002?

I expect 2002-03 produced Non-durum wheat for sale to the CWB this crop year, will be 8mmt, am I far off CWB projections?