Positive Wheat Basis

[Oilking]

I've taken notice grain companies are posting positive basis levels for red spring wheat now in western Canada.The cash price is still nowhere near what it should be but just am wondering what is the reason behind this. Is there really that much poor quality wheat out there and hardly any #1's or #2's? That is what I've been hearing.

[bucket]

Yup but the bigger question is where is that 70 mmt crop from last year?

Odd that buyers are paying more for a number 3 durum than they did for a 1 cwad a few short months ago.

Makes you wonder why they don't buy 1 at a premium to keep quality or maybe a 3 is all they buy most of the time and the graincos keep the grade spread.

[boarderbloke]

Part of it might be that famers have space for the 2014 crop, and they're not "fire selling" like last fall just to avoid bagging it or putting it on the ground. I think a lot of farmers are gonna sit back for a bit and see whether some of the grading doesn't ease up in a month or two. Isn't there a saying that after Christmas it'll be a grade better?

[bucket]

Oh yes I forgot guys built bins.

Now it's obvious to the marketing reps where to go to make the first round of deals. The shiny snow fence stands out from a distance.

[PrairieDude]

I agree with bucket. Where is the remaining crop from last year. Think this proves Stats Can was way off

[charliep]

Not going to predict how much better basis is going to get or for that matter whether you price. Your decision.

Having said, when your spouse snuggles up next to you on those special nights, do you ask this many questions? Sometimes an opportunity is an opportunity.

[Guest]

thats what i want to know ? where is all that wheat gone ? and why doesnt one of our farm groups (ie fna , apas , etc. ) (or that western producer that is so hell bent on keeping prices down ) expose that bullshit that went on last year ! no one holds any of these pricks accountable ? how can stats can be that far off ? they were probably amazed at how good it worked in canada with us dumb farmers , that they decided to try it in the US this year ! thier "BIG" crop is probably the same bunch of horseshit . they have had shitty harvest weather all over , lots of that grain will be shit also , but yield estimates just keep going up , up ,up ? what a bunch of horseshit . at least farmers here are waking up and not giving grain away . that is the ONLY thing that causes a positive basis .

[charliep]

Price Calgary area today 1/2 CWRS 13 plus protein - Cdn $6.25 to $6.50/bu. Price Great Falls Montana - Cdn $7 ish/bu (USD $6.25 to $6.50/bu).

[bucket]

charliep

And you don't see a problem with that????

Caseih.

What saved the USDA with their numbers the last 2 years is the early harvests that allowed them to count new crop as old. They were imprting soybeans for quite a while this year to make the numbers work.

[bucket]

Charliep

On 100000 bushels that discreprancy is as much as you make in bonuses for a year. lol.

[furrowtickler]

This positive basis shows two things, farmers realize that they were totally ****d last year with outrageous basis levels and are simply saying no right now. And the fact that they can have positive basis levels just after harvest is interesting and proves one thing rarely brought up with marketing experts - production numbers are only one piece of the pie - whats the quality break down. This year its is huge.

[bucket]

And for the guys that have the shiny new snow fence.

Don't take this the wrong way. Thank you. Good for you. More than likely you can easily tell the graincos to **** off and get the storage paid for.

Thank you from someone who doesn't have that option.

[charliep]

For what it is worth, the Great Falls price for a DNS (spring wheat) 13 protein is USD $4.80/bu or Cdn $5.40 ish. Your discount from a 14 protein (similar to our 13.5) to 13 protein (similar to our 12.5) is USD $1.60/bu.

I will put the most recent CGC quality data up from their harvest survey.

[URL="http://www.grainscanada.gc.ca/wheat-ble/harvest-recolte/2014/sqd-dqs-2014-en.htm"]CGC[/URL]

[Guest]

here is an actual quote from a local big box elevator on daily propoganda text on prices : "we are full on oats until march BUT got 1000 tonnes for $2.77 for dec ". kinda makes you feel like you have an idiot sticker on your forehead when you read something like this ! just like they were all bought up with wheat and canola until next summer , doesnt appear that way now with positve basis , lol

[sumdumguy]

Maybe when a few more ships pull into Vancouver and the demurage starts adding up, the basis will be even more positive. Let's hope.