We finally got started combining tonight after 2.5 " of rain last week, yield looks good but don't have a firm number yet. Finally got around to calling around about prices this morning, the Ontario Wheat Board is expecting a final payout of about $155 on SWWW with an initial payment of $112 minus elevating etc. to get about $88 now and the rest when the final payments come out. Ended up contracting with the closest elevator for $185, said they'll take all we can give them at that and they're also offering contracts for next year's crop at $171 today. Lots of guys complaining that contracted this spring at $160. Expect a lot of SWWW to go in the ground in Ontario this fall, corn and soybeans can't compete for profits at prices like these.
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Charliep, Ontario wheat
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Thanks for sending. It is good to have benchmarks. Current feed wheat price is close to $185/t. CWB PRO forecast similar for top grade high protein hard red spring but declines for lower protein/other classes. Alberta based soft white spring PRO is about $159/t ($4.30/bu for those of us who haven't been metrified).
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Hi dalek,
This is what CWB chairman Ken Ritter said about Ontario farmers and their wheat market.
For example, the Committee talks about producers in Ontario and Quebec enjoying “increased flexibility in the marketing of their wheat and barley”. With all due respect to the Committee members, increased flexibility is of no benefit whatsoever if farmers are getting less money for their grain.
What is happening in Ontario only matters if farmers there are better off financially.
It would seem judging by your comments about new crop winter wheat prices that Ontario farmers are indeed better off finacially in a system with more than one option for wheat marketing.
Would you concur?
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What are the rules about how you contract? Do you have to indicate your preference of markets ahead of time? Are you required to participate in the pooled price (eg. allocate half your production to the pricing pool)? Are the grain companies/millers required to split their purchases between the open market and OWPMB?
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Dalek
I apologize for more questions but I find it interesting to compare what Ontario does relative to western Canada?
How much grain storage does an Ontario farmer carry relative to their normal harvested crop volume? Does OWPMB payments pay interest and storage on payments for grain required to be stored (millers have need 365 days a year/draw when needed)? My assumption is that eastern Canadian millers are just in time buyers with very little storage capacity? Do they buy on farm with a contracted delivery scedule/pay storage?
Western Canadian farms build enough storage capacity for anywhere from 2/3 to all their normal harvest volume. I look for comments on this point. With the exception of malt/other special contracts, the farmer is not paid storage (captured by the CWB pricing pool if at all). This situation is being aggravated by the move the move to more high through put elevators/reduced storage capacity in the sytem. Processors keep storage capacity to a minimum (storage/paying carry on grain inventory is expensive).
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We have enough storage for what we keep to feed on the dairy side. Otherwise everything goes from field to buyer. We don't have to put anything into the pool. Contracts are done through the board, but in our case the elevator we got the contract through is dealing with the board for us and doing the paperwork. As far as most of the other details, this is our first year dealing with the contracts so I'm not up on all of them yet (same boat as most Ontario wheat producers) but my impression is that there's a little bit of everything you mentioned going on.
Called the elevator again this morning and the contract price for next year is up so we booked about 60% of what we expect to grow at $199. Fall red was booking for $193, spring for $230.
The first load we sent in was 1.3% fusarium, 14% moisture. Air on the combine was turned up and everything since then has been below 1% fusarium and 13-14.5% moisture. The elevator we deal with has a tester for the fusarium and haven't found all that much, our local co-op tests visually and said this morning they've graded every load they've received this year as feed for fusarium or sprouts. Lots of people switching destinations now.
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Dalec and Charlie,
I was Just looking at OWPMB prices on http://www.ontariowheatboard.com/Basis.html.
It says there today that Soft white cash price is $188/t through the OWPMB, and $180/t minimum price...
Why are these numbers so much different from what you folks have been talking about?
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Good question. It's been changing day to day lately so fast, I don't know what the answer is. There's a good story in Better Farming this week about the wheat board, changes, and challenges it's facing, but it isn't online yet at www.betterfarming.com
Final yield was 70-71 bu/acre.
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Dalek,
I was wondering if the cash prices you are quoteing are actually OWPMB cash prices, through the elevators, or if you are actually signed up to do the exemption that exempts you and the elevator from dealing with OWPMB with the wheat you just harvested.
My understanding is that you yourself would have had to sign into the exemption, many months ago, if you are selling now outside the OWPMB.
It would be interesting to know if the wheat market arbitages between the OWPMB cash prices and the wheat sales that are made through the exemption process.
Could you maybe check about this and report back to us?
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