weeping in my wine glass

[btjadenlepp]

here's an example of what marketing planning means:
- studying wheat fundamentals to determine the trend; identifying it as higher
- waiting diligently for a sign of a reversal before pricing
- realizing throughout the rally that we can't possibly pick a target to sell at that won't be at risk of being too low
- determining that we need to see a couple of consecutive sharply lower closes before we'll be sure that at least a short-term top is in
- seeing the signal and cuing up a sale
- comparing the profitability prospects from all the different crop options in 08, deciding how much wheat to plant, forecasting a reasonable yield and calculating expected new-crop production
- determining within the current market environment what percentage of that is safe to price, especially given uncertainty in the basis
- calculating precisely how much to sell when the signal comes
- getting the job done by sending in the forms on the day when all of this comes together

at the risk of revealing too much, we had it all lined up to price some new-crop wheat futures-only today, the result of 8 months of study, analysis and discipline, just when they pulled the program.

i crumpled when i heard the news. then i went to the can and puked.

with all due respect to their mandate, motives, internal business needs and risk management challenges, i have to wonder if anyone downtown went through as much anguish as we did 'on behalf of farmers' today.

WHAT A MESS.

[silverback]

This is beyond ridiculous.

What will happen now?

How is it that the guys that priced FPC's over the last few days are now sitting pretty (assuming this was a topping) and anyone wanting to do it today is out of luck - with no warning?

Should we be signing up basis payment contracts tonight instead?

[btjadenlepp]

you can't price basis contracts (futures only) tonight, that's the rub. believe me, we tried.

it's SO unfair. if they're going to shut it down now, they should cancel all the futures-only contracts done for 08 so far, including the ones done at much lower prices in the fall.

as charlie noted earlier, we know they've bought at least 500k because the force majeure has filled.

if they're going to cancel the program that we built our marketing plans on, they have to cancel the whole lot. otherwise they never should have put it out there in the first place.

and i understand lee's point about it being what they need to do to avoid buying futures that they can't lay off in a limit-locked market, but that was not the case today. minneapolis was trading. they had alternatives. we, on the other hand, did not when this announcement came down after the markets were closed and our brokers had gone home.

[parsley]

Wonder if any teachers pets got a heads up?

Parsley

[Ron]

So when "normal" trade on the exchange resumes will they reinstate the program?

[bgmb]

I'm sure they will, but lord i wonder that the basis is going to look like.....

[cottonpicken]

Oh great wise one please be the guiding light to were this is headed.

I seem to forget your prior proganstiantians.

[dalek]

Ummm.... enlighten me on the $25 word cottonpicken?

[dalek]

Was that "prognostications" or just some prairie word I haven't come across?

[btjadenlepp]

basis and futures are negatively correlated, that much we know.

so maybe not getting our futures sold will help the basis? if they had taken on the 1-2 mln tonnes that was probably cued up tonight, they would have had to absorb it somewhere, and we all know the Basis is also a dumping ground for pricing mistakes.

[cottonpicken]

"had it all lined up"-Excsept i forgot to post it...haaaaaaa,must be snappy

[cottonpicken]

Refer me to your pryer post were you seen this coming.