Perfect competition

[ado089]

In another thread it became obvious that some on here don't understand what an open market means and the importance of competition in that system. Here's a little study guide for you. Read the entire entry and then compare it to agriculture in Canada. What economic model do you think we as farmers fall under vs our industry partners?

In economic theory, <ahref="http://en.wikipedia.org/wiki/Perfect_competition"target="blank">perfect competition</a> (sometimes called pure competition) describes markets such that no participants are large enough to have the market power to set the price of a homogeneous product.

[ado089]

<ahref="http://en.wikipedia.org/wiki/Perfect_competition"target="blank">Perfect Competition</a>

Lets try that again

[ado089]

<ahref="http://en.wikipedia.org/wiki/Perfect_competition"target="blank">Perfect Competition. </a>

[ado089]

[URL="http://en.wikipedia.org/wiki/Perfect_competition"] Perfect Competition. [/URL]

[riders2010]

Perfect competition is when in utopia everyone competes without interference and that way only the most talented win. Only thing is utopia doesn t exist, because in order to win human nature is that cheating starts. outside influence is bargained for votes money sex and drugs. Its reality. So as it goes along not always the most talented get ahead but usually the most crooked,rich, stoned out sexed up individuals in one way or another control everyone and everything. Until of course they get so big that governments and people that they are actually screwing decide well we cant let them fail because of my little pension will be gone. That pretty much sums it up. Its in every industry every facet of life almost. There s even politics at the Vatican so how could there not be everywhere else.

[ado089]

Riders, my point is that production agriculture is full of contradictions when we start talking about the concepts of competition and open market.Obviously a true open market driven by pure competition is impossible but to burry ones head in the sand and and humm away happily because the CWB is gone is ridiculous.

[bucket]

True competition means you don't call one another to set the price like the graincos are doing right now.

We have true/perfect collusion.

There is no such thing as competition in Canada in grain or cattle.

But for those that don't believe me do like our federal ag minister learnt from his ag days, put your head in the sand.

[stonepicker]

I'll take this market over the old soviet style cwb every day of the week. Were wht. prices high every year under the cwb.? A resounding no!! Anybody who sold their wht. early instead of late for 2014 crop did well. Wht. and canola drop from historically high prices and everybody screams about the evil grain companies. Why would any grain co. wanna buy grain they know they can't move in good time? Prices will go up again. Garanteed

[ado089]

No one wants the cwb to return. What we have a problem with is a $3 or more basis and no access to outside markets due to a grossly dysfunctional transportation system. I was on the eight side of selling early but the structural issues need to be fixed unless we are only expecting to get a normal crop once every 5 years.

[stonepicker]

I agree that our transportation system is dysfunctional, it has been for a long time. But we did hav a huge crop and a bitterly cold winter and i believe we're farther from salt water than any other exporting country in the world. But there is definately room for improvement. I'm just saying, if the grain co's can't move it for sale,their not gonna pay top dollar, hence the wide basis.I'm optimistic that things will improve in the future.

[ado089]

I only deal with grain companies when it's a matter if convenience. This year had the mill I dealwuth say to me that I had the best wheat they'd seen last year but they couldn't deal with me due to unreliable rail service. We need contracts that work for farmers and buyers. We need rail transportation reform. Revenue cap overages need to be out toward infrastructure improvement.

I just find it awfully rich that the reason so many were up in arms to get get rid of the CWB was because they stood between us and world prices. Yet here we are three years later and we are as far away from world prices as ever. Prairie to port price or equivalent delivery points in the US is the benchmark we should be working from, not patting our self on the back if we think we sold for a buck a bushel better than the neighbor.

[riders2010]

Come on the premise was get rid of cwb the grain cos are honest. Fk that plain and simply hosing the shit out of all of us and if we had half a brain as a whole sector we d tell them to f right off but the is no competition anywhere they have us hooked into everything inputs and selling the grain. It's only going to get worse because they are picking which farmers or corporate farms they want to succeed. Speaking if inputs where is the competition when the private and large input dealerships all have agreements not to go into other ones areas to do business. We ve gone so far in this private is great world here that we re just about around the bend to the same thing Russia is only different types of groups control us and the farmers there.

[riders2010]

Come on the premise was get rid of cwb the grain cos are honest. Fk that plain and simply hosing the shit out of all of us and if we had half a brain as a whole sector we d tell them to f right off but the is no competition anywhere they have us hooked into everything inputs and selling the grain. It's only going to get worse because they are picking which farmers or corporate farms they want to succeed. Speaking if inputs where is the competition when the private and large input dealerships all have agreements not to go into other ones areas to do business. We ve gone so far in this private is great world here that we re just about around the bend to the same thing Russia is only different types of groups control us and the farmers there.

[farmaholic]

If I could avoid selling a kernel to those ****ing Prairie Pirates I would. The railway may have opened the door for the creation of the problem but I think the Pirates will use it for their benefit and will leave it wide open until, like someone on here said, a short crop forces them to compete for business, until then, lube up.

So if you're an ass kisser and have a good "relationship" with the Pirates they will cater to you.
But if you stand up to them and their marketing scams and call them on grading issues you get branded hard to deal with. The only difference in the wheat, durum and export barley market between now and CWB tenure is who you call Master.

Genuflect, bow your head, remove your hat and hold it against your chest, with sample in hand extend it upwards to your Pirate "Friend" and ask him what he'll give you for it. Both grade AND price. Oh, the new mantra is grade doesn't matter only the net price. Quality doesnt mean anything anymore. Do the Pirates sell based on quality. Send the enduser some #3 12px instead of the #1 13.5 px they specified, tell them it doesn't matter.

What a bunch of disrespectful Assholes....

[TOM4CWB]

Ahhh... the market gurus have spoken.

I will take what we have today, marketing and risk management; as a blessing. We put reasonable targets on the table. Competition bought the grain we needed to sell this fall.

We have a great crop coming. And the cash flow to match our needs to make a farm work.

No excuses... personal responsibility as usual is needed.