Spring Wheat

[cottonpicken]

Just punched through 10 bucks.

[charliep]

Interesting to watch the daily price contracts and the bonus the lucky individuals who managed to sign up under the 650,000 tonne cap are getting.

Current CWRS dpc prices are about $2/bu over the PRO with the premium rising. Assuming 1,500 bushels on "B", that is a $3,000 or enough to pay for an all inclusive vacation for two somewhere hot this winter.

Yes there is money to be made in marketing Burbert and opportunities present themselves for those that are astute managers/able to make decisions. Two hours of work/decision making everyday for those who care to spend the time will likely pay for all the presents under the Christmas tree.

DPC pricing/charts.

http://www.cwb.ca/db/contracts/ppo/ppo_prices.nsf/daily_price/2007_index.html

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

[northfarmer]

limit up MGEX dec and mar. wild......and canola hitting 500 further out.....this is dec...not April.....when are the longs to to take profits????

cp your $12 what might just happen....but never in canada is the tragedy....

by the way...screw the CWB

[btjadenlepp]

those clients who were with us in june all got 20% of their wheat signed up under the dpc, thanks to their marketing advisor. and we haven't recommended pricing them yet.

www.farmlinksolutions.ca

[cottonpicken]

So at this farmlinksolutions how come your market insights only go back a month?

You could gain a little credibility if your "insights" went a little further back so people could see if your a closet full of morons or actual competent proffesionals.

[charliep]

cottonpicken

Just a question about what your expectations of a consultant would be? My experience is that it is a lot more than someone who magically forecasts prices or claims they can. From my side, the consultant should provide advice that contributes to the long term financial success of a farm business and reduces manager stress in an uncertain world with risk. Risk is both opportunities and negative consequences. My experience is that managers who focus on profitability (which marketin is an important part) make far more money than those who believe they can forecast the market.

The thread started with spring wheat so my question is how many dollars did you put in your bank account today? I note in the past you said you mainly trade stocks and not margined accounts like futures. Too bad. You'd have fun.

[just_wondering]

I would have to call the DPC progam more like a time limited IPO not a lotery like some in the past have called it.
Everyone who reads this forum knew about the progam before it happened it was late gettig rolled out so the hype was still rolling.
The Idea that it would sell out in an hour and a half I think astounded everybody but, that the fact that it did shows how much people want to market their own product not pool their gains.
I never did as good as the farm link customers though I have been selling DPC and FPC all year. Brenda I thought that in your speaches last Jan. you talked about incrimental selling and marketing plans, did you predidct $10.00 minni. wht?

[charliep]

I can answer never in my wildest would I have ever predicted $10/bu wheat. Suspect the same thing could be said for the CWB. Even today, how much space is there is the January to February time period for the CWB to make additional sales? How much of the current run up in prices is based on speculative action and how much is supported by solid commercial business?

Will note btjadenlepp recommendation for farmers to hold their nose on the ugly basis levels from Sep/Oct and book basis this past fall? Anyone who took this advice will put more money in your pocket than a neighbor who did nothing and is simply accepting the PRO or paying the premium on an EPO. The March CWRS FPC is $360/tonne and even if you locked in the weakest $30 under basis, a farmer would be $40/tonne better off that the forecast PRO.

Will note that the forecasting processes have started for 2008 on my side. Will note at least some opinion that wheat will drop to under $6/bu by next fall. Disagreed/have the battle scars to prove it but there is that opinion among some analysts.

[charliep]

Found the thread for the above from an August 31 posting (about to go into archive). Anyone who took it is $ ahead.

btjadenlepp posted Aug 31, 2007 10:37
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best you can do is a CWB Basis contract. i know everybody hates them, but if you can plug your nose and suck up the stupid basis, it does reduce your reliance on the pool and gives you control over pricing.

if history is any lesson, the basis and adjustment factor are only going to get worse as the futures blow off.
IP: Logged
Edit?

[malleefarmer]

How will the recesssion be it mostly in the USA or world wide doesnt make much difference what will it do to grain and oilseed prices.
I think its been touched on before by cotton but the more i read the the usa is heading that way, weakening its dollar so its helping there.
Imagine if your loonie or our south pacific peso was 25 cents lower?

And with hyper inflation in porer countries whos going to buy the wheat?

[btjadenlepp]

1. the insights get removed after a month so the content doesn't get dated or stale. point taken though about adding to the credibility though, maybe we'll put the old ones into an archive on the site instead. by the way, 'closet full of morons', that's cute. i'll use in our next employee development meeting if you don't mind. but seriously, it's not fair since we are all out in plain view, fully accountable for our strategy ideas, just trying our best to make as much money as possible marketing crops.

2. no jw i didn't predict $10/bu wheat but even if i had we wouldn't have gambled 100% of the crop waiting for it to show up. we have most often maintained a friendly bias to wheat through this rally, which is why we've kept our 20% dpc increment open. everything else is priced via outright fpc's and priced basis contracts already.

3. thanks for your posts charlie, we appreciate the support.

www.farmlinksolutions.ca

[nw9flynn]

I agree with CP,

If most consultants knew anything about the markets they would quit being consultants and be in the market instead of talking about it.

Anybody can brag about advise after the event has happened. Lets hear some predictions brenda??? I bet most of your market rep's don't even hold commodity trading accounts...

[FarmRanger]

I knew a guy years ago who could play commodity trading simulations and make money like crazy. When he tried speculating futures with his own money he lost money.

Makes a big difference if it’s your own money on the line. Fear/greed can alter good judgement. I wouldn’t trade with a broker who was speculating his own money in the market.

[charliep]

To be fair to btjadenlepp, I don't think I have seen a posting from them on using futures. The posting I have seen are on timing sales (including CWB) and basis.

If anyone has mentioned futures, it has been me and hopefully only to encourage some activity on the cash sale side. In the wheat example, it may be better to deliver/price out a 5,000 bu wheat sale and replace with futures - particularly if you have to roll a CWB fpc (CWB takes away carry when you roll a contract forward).

Given the volatility in this market (will not go away), everyone has to be very carefull either hedging, using invertory replacement strategy or 100 % speculating. If you are using a replacement strategy, you may have to keep more of the sales proceeds in your margin account and from there wider stops. You also don't what to sell cash/buy futures the same day. Sell cash on days the market rallies/buy futures on dips.

[charliep]

malleefarmer

No one else with thoughts on your question. My most recent forecasts in this area is the Informa Economics conference. One speaker was cautiously optimistic and the other negative. Will leave others to comment.

Off topic but how many farmers in Australia have a strategic/business plan that describes where they want their businesses to be in five years and how they plan to get there? How many woud have done a SWOT analysis of their business? The SW is strengths and weakness that apply specifically to that that business. Opportunities and threats (OT part) are things over which farmers have no controls. I would put your question in the threat contegory and one that all farmers should be asking themselves if they are making long term investments in growing their business.