FPC before PRO

[Ooofty]

What did the Fixed Price Contract for spring wheat do in the days before the last PRO?

[charliep]

Will leave to forecast but will try to give my two bits on fpc basis levels. Will use the CWB historical charts.

http://www.cwb.ca/public/en/farmers/producer/historical/pdf/2007-08/0708fpcbpccharts.pdf

For CWRS, the converted MGE price has gone up about $40/tonne since the August PRO (see first slide). Would agree with analysis in the next thread the CWB will not increase the PRO the full amount (existing sales, new crop prices/uncertainty over farm delivery patterns and impact of producer pricing options).

Basis (slide 17)$7/tonne under for both the July and August PRO. Others will say has been a change day in the past but always have to ask why these changes don't occur as required during the month. Same comments adjustment factors but again the risk is more negative as the size of the crop (at least high quality) drops and existing sales in the pools make up a higher percentage total sales.

EPO premiums will be the real factors to follow.

[charliep]

Ooofty

Should have read your question. The fpc prices (at least CWRS) increased during late July/August with the August 23 PRO a catch up day. You can see this on slide 7 of the CWB historical charts.

[charliep]

One caution. These fpc charts do not include the adjustment factor so you need to take that off. Interesting, the charts that compare the fpc to the dpc do take out the adjustment factor. The dpc is higher than the fpc by about the amount of the adjustment factor. A benefit for the lucky who won the 650,000 tonne lottery.

http://www.cwb.ca/public/en/farmers/producer/historical/pdf/2007-08/0708dpccharts.pdf