Malt Spot Delivery $6.24 Canadian/ Feed $5.73

[SASKFARMER3]

Cash Prices
Delivery Minot Ryder Niobe Norma Lignite Velva
ROBUST 6.20 6.20 6.20 6.20 6.20
CONLIN 6.20 6.20 6.20 6.20 6.20
LACY 6.20 6.20 6.20 6.20 6.20
TRADITION 6.20 6.20 6.20 6.20 6.20
Cash Prices
Location FD BARLEY FD BARLEY FD BARLEY
Minot 5.70
Mohall 5.70
Ryder 5.70
Niobe 5.70
Norma 5.70
Lignite 5.70
Velva 5.70

[cropduster]

POW-WOW from AGRIWEEK
Things may be headed for a showdown on barley marketing

Agriminister Ritz last week called a meeting for Jan. 29 of representatives of the Canadian Wheat Board, the grain trade, maltsters and farm organizations to 'discuss the future of the barley industry'. The meeting will be in Ottawa and, according to a press release from the minister's office will “focus on finding ways to move toward marketing choice”. The meeting does not sound as if intended to find a compromise between the fanatic defense by the Board of its single-desk monopoly and the now-intense and general desire of everyone else for a free market.

However the minister has reportedly said that he would consider a continental market in which the Board would be out of the domestic and U.S. trade but would retain its single-desk monopoly for offshore feed and malt sales. The Board is apparently telling the trade that its proposed 'CashPlus' scheme will remain even if marketing is deregulated, implying an acceptance of the principle of a dual market. Any compromise would be considered a weak half-measure in the trade and among barley growers.

Meanwhile the Board continues to promote its CashPlus scheme, which most farm groups, grain handlers and malting companies have rejected. The rumor around Winnipeg was that the Board is threatening to refuse, or is actually refusing, to supply malting barley to domestic users on the previous basis and also will not pre-sell 2008-crop barley ahead of the start of the crop year Aug. 1.

The Board also attempted to explain the program with examples, claiming that if it were in effect today farmers could be getting the equivalent of $6.50 a bushel ($299 a tonne) for two-row malting barley. Updated pool return figures were to be released after this newsletter's weekly deadline, but the December report projected a 2007-08 final price of $287 a tonne or $6.25 a bushel. Since the Board already unilaterally sets malting barley prices to the domestic trade, which under the monopoly cannot legally buy from anyone else, it is completely unclear what feature of the alleged CashPlus scheme generate any price premium to producers. American malting companies are reported to be contracting with growers in Montana for 2008 at $6.75 to $7.45 a bushel.

Many details are still missing but the Board claims that additional premiums could be paid to participants derived from 'spreads' between the cash price guaranteed to growers and actual revenue from sales. There is no explanation of how such a spread would develop unless the Board proposes to withhold part of the money paid by buyers. Besides defeating the objective of providing the entire payment up front, it implies that the Board would feel free to manipulate prices, which is the very thing that buyers want eliminated.

Until this is settled one way or another there is great unease in the malting industry. The market outlook is uncertain enough already with no good indication as to farmers' barley acreage plans in either Canada or the U.S. If American malting companies are willing to pay over $7 a bushel for barley that two years ago was had for $2.50 and one year ago at $3.75, it must be because they sense that competition from other crops will severely curtail barley acreage. Canadian malting companies cannot do anything to assure a 2008-09 supply because they cannot contract directly with growers. They rightly fear that the Wheat Board is completely capable of holding them for ransom in its life-and-death fight to keep the monopoly.

If the Jan. 29 meeting ends with the Wheat Board intact, it will be a victory for the Board and a defeat for the government, the malting industry, the grain trade and growers.

[cropduster]

WESTERN BARLEY GROWERS ASSOCIATION

A strong voice for a vibrant, market responsive barley industry in western Canada

Agriculture Centre – 97 East Lake Ramp NE

Airdrie, AB T4A 0C3

Phone: (403) 912-3998

www.wbga.org Email: wbga@wbga.org



CANADIAN WHEAT BOARD CONFIRMS NOTHING



January 25, 2008 – Airdrie, AB: The Western Barley Growers Association (WBGA) condemns a statement made earlier this week in which the CWB states it will offer forward sales contracts from the malting barley pool to interested malsters and other customers. “This statement, if anything, confirms the fact that the CWB has been holding hostage Canadian maltsters, Canadian grain handlers and western Canadian barley producers the right to market their new crop barley” states Jeff Nielsen, President of the Western Barley Growers Association (WBGA). “We have lost sales due to the fact the CWB has denied the trade the right to sell malt barley to their customers, thereby reducing returns to farmers. Now the CWB says they are willing to allow the trade to facilitate sales, and make direct contracts with producers if and only if they abide by CWB rules”.



With this the CWB continues to push the CashPlus program that farmers, maltsters, the Western Grain Elevator Association and the government of Canada have flatly rejected. In trying to intimidate the trade and producers the CWB continues to lose any lingering respect of western Canadian barley producers might have had.



“There is nothing new here, except the Board is now throwing in a new risk premium for pool account sales, the system has moved from dysfunctional to completely unworkable” states Tom Hewson, WBGA Vice President.



The message WBGA members have given its delegation going to Ottawa, January 29 will be to ask Minister Ritz to order the CWB to issue export and inter-provincial licenses for barley and barley products as an interim measure until barley is completely removed from the CWB Act by legislation on or before August 1, 2008.



“It is clear the CWB refuses to respect prairie barley producers and move forward.” says Doug McBain, Past President. “By insisting that western Canadian barley producers accept a non transparent - unclear pricing signals and third party interference by the CWB, this will only continue to drive barley production down”.



Nielsen has been attending the Western Canadian Wheat Growers Association convention in Minneapolis. In speaking with US farmers, and malting company representatives, Nielsen has seen first hand how contracting directly with the maltster benefits the US producer. Pricing opportunities for new crop malt barley are well in excess of $7.00 per bushel. US maltsters know they have to pay high enough dollars to attract acres to barley production. With these contracts in hand, US producers can facilitate their financial planning needs with their lending institutions easily.



Canadian malting companies and grain elevator companies need this freedom to do this as well. Without this, western Canadian barley producers will be shifting acres out of barley, choosing crops that they can market freely, and contract for profitable prices and thereby securitize financial needs – as crop input costs continue to rise.



“The CWB has put our domestic malting sector and international malt sales at risk as they will not be able to attract the barley supplies needed. Jeopardizing value added in western Canada, and farmer’s net farm gate returns is totally unacceptable” concludes Nielsen.



WBGA respects the wishes of the government of Canada when it proclaimed in the throne speech, "Our government will recognize the views of farmers, as expressed in the recent plebiscite on barley, by enacting marketing choice".



-30-

For more information contact:




Jeff Nielsen

President ~ WBGA

Olds, AB

Cell: 403.556.0408

jeffniel@platinum.ca



Tom Hewson

Vice President ~ WBGA

Langbank, SK

Phone: 306.538.4572

hewws@xplornet.com



Doug McBain

Past President ~ WBGA

Cremona, AB

Cell:403.816.0645

dmcbain@wbga.org

[chaffmeister]

The CWB has often said its policies and marketing decisions support US prices. I've never seen it that way - until now.

A lot of talk about US new crop bids for malt barley - really good prices it seems too. As Agriweek put it:

"If American malting companies are willing to pay over $7 a bushel for barley that two years ago was had for $2.50 and one year ago at $3.75, it must be because they sense that competition from other crops will severely curtail barley acreage".

They're doing the math and trying to buy malt barley acres. Because they can. Good for them and good for US barley farmers.

I see another factor.

The US imports about 300,000 tonnes of malt barley from Canada - give or take. Now if you were a US maltster that depended on a supply of Canadian barley, and saw the price signals from the CWB, I think you'd be pushing your local bids higher too.

So I guess it's true - the CWB's decisions can support US prices. Too bad it has the opposite effect on Canadian prices.

[Hopperbin]

Lots of talk about this cash plus program from the board. Why is there not a cash export malt program with less stringent specs as the export market is less fussy than the domestic market. If they are paying 7 in the US for lower quality 6 row. Then the price here should be more like 8 dollars for higher quality 2 row. Where are the bids from the chinese? They are supposed to be sucking back more beer than ever. As a farmer I want to be shown some bids net to me. I want to see who is buying, how much is being sold.