pricing $10.39/bu 2 cwrs...

[northfarmer]

with the limit up close i will sell another increment of my dpc that will net me over $10 dollar a bushel for my cwrs....and Jensend, if you are reading this and are tired of you debate with pars...I will take the ten dollar wheat and use it to better capitilize my farm, you see the inputs and cost on this wheat are known and this price goes to the bottom line....

I have already locked my fuel, seed and fert in for 08....so i am also doing an increment of new crop wheat, of course not knowing the basis, it will be close but not at the levels of Ontario and US wheat growers that are locking in $9 new crop red spring wheat.......

if we are entering into a new plateau of pricing I welcome it with open arms and now only beg for the freedom to price all my production in a open a transparent market environment....sure we will have rising costs of production driven by demand, but these will be tempered by new supply and thse markets will reach an equillulibrium if they are allowed to...

the only sad thing is that I only got a fraction of the dpc I had wanted this year, I did not get any at all the day it filled, and was gratefully the benefactor of a transfer from a farmer to get any at all....

and we did not leave any in the pool, even priced a little of my unpriced bpc at $9.70 ish...still way better than the PRO!!!

[jensend]

where does everybody get the idea i'm against these prices? all i said was there are implications just as there are to lower prices. you guys paranoid or something? grainfarmers deserve this after years of losses. improving equity position has to be done after a period of living off your equity and locking in inputs is every bit as important as locking in revenues. i just looked back at previous runups and the aftermath and thought there was something to be learned. sorry i thought there were some issues to be considered. primary producers have not been receiving an equitable portion of the value of the final product. i think changing that is the biggest issue facing farmers because it is not a free market out there or you would get value for your production. nobody knows how long margins will stay as large as they are now (maybe they'll get wider) but historically this is an exceptional year and in the past those who thought the gravy train would never stop didn't do well.

[northfarmer]

good point on the gravy train never stoppin, prices will decline, margins will shrink or go negative and losses will be incurred, good balance sheet management and risk management strategies need to be used, when prices are low or high, i do not plan on abandoning crop insurance for production losses and like the idea of a couple of years of very good reference margins on the books....

but you raise a good point about farmers geting a bigger share of the eventual food dollar....the key to profitability in growing crops, especially commodity crops that will be exported, fed or processed into food products by someone else is to grow them with the cheapest per unit cost, through scale, technology, good agronomy and production management, marketing moxy and capital efficency, etc....

if you think that somehow we can tilt this system in Canada and the world to secure traditional primary producers a bigger piece of the margin on the eventual food product you will only be able to do so by investment and direct particpation in these value chains beyond the pit in the terminal, the ring at the auction for your cattle, the feedlot down the road that buys your barley, etc...

fact of the matter most farmers just want to keep doing what they are doing, just growing crop, investing in more farm land, maybe rolling into some newer iron, selling their calves and not retaining ownership through to finnish, etc....

though there are many progressive farmers that are both great producers and smart investors/businesspeople in value chains beyond the normal production cycle of crops and animals...they have invested in producer owned grain terminals, processing plants, retail food and wholesale supply, invested in companies through shares in equipment manufacturers, biotechnology companies, fertilizer mfgers and distributors....or diversified their investments right out of agriculture altogether in to mining, metal, oil and commercial real estate....

growing crops and commodities will always be a tight margin business where every dollar counts....our take at the "TRADITIONAL" farm gate as a percentage of the actual food expenditures of consumers will likely never reverse to the producers favour.... it has declined over time...

but there are many farmers, and the mumbers are growing as a percentage of actual producers and definitely as a percentage of actual production that want to rid themselves of collectivist state sanctioned marketing controls, why? because every dollar counts and when all you want to do is grow crops it is that every dollar that remains so important..in good times to build your balance sheets for the tough times that follow.......

in 95 is spent capital that could have helped in the wrecks that followed for me, this time I build the balance sheet, the best deals will be there when the bubble bursts...

oh,

and screw the cwb!!!!

[FarmRanger]

We’ll live with any “consequences” of high commodity prices regardless of whether we receive them or not. Will fertilizer will be cheaper here because we got the lower CWB price?

Unfortunately for us who didn’t even get in on the dpc (faxed in at hour 4), we can’t benefit from the high prices. I could buy a brand new combine (green) with the difference between the PRO and the market price on the board commodities I grew this year. Money gone forever that could have been used to cushion a future downturn.