CWB open WHEAT Quotas

[TOM4CWB]

Charlie;

I see the CWB comment on contracting and the restrictions on deliveries these contracts contain.

Yet the CWB is totally stuck on the view of the pool... and will not consider cash pricing during the crop year after harvest, the most important time to make a decision on cash pricing.

If we like ***Kernel clearly identifies... a need to cash price with a reasonable basis (the CWB in all the PPO contacts over the years hasn't met this need) I just may be very happy to take a little less to recieve the premium price.

Domestic Barley and Canola both Domestic and Export have no problem at all regulating movement during harvest... why exactly would milling wheat need to be any different if a CWB cash price were the standard... instead of the weird inbred flat pricing system we have encountered as the "CWB's Best" at offering market signals!

Charlie, can't we do better?

[charliep]

I will leave for discussion.

A comment I will make is that it is too bad the current PRO system is a hybrid of current market conditions and CWB market analysts forecasts. A suggestion from the past is that it is too bad the forecasting function couldn't be taken outside the CWB with their posted prices only being what they feel they can capture based on what has been sold and what they could hedge using futures markets/their sales program.

[charliep]

A note the Treasury Board of the Federal Government will not be happy with the CWB. They are the group that looks after the guarantees for CWB initial payments on behalf of Canadian taxpayers and the ones that cut the cheque if the CWB over under estimates total payments/their is a deficit in the system.

A interesting editorial written by Ian McCreary is located at:

http://www.cwb.ca/en/news/letters/103102.jsp

I encourage everyone to read it.

On the subject of federal government initial payments/producer pricing options, this article states the following:

"Since farmers took over the CWB, we have changed rail car awards to have the system more tailored to farmer needs. We have developed pricing options which allow farmers to forward contract or to price basis a U.S. futures market. We have reviewed organic policy and streamlined the manner in which organic grain may be marketed. We have introduced performance benchmarking to measure the value of our marketing. We have revamped internal risk managemnt. We have developed an early payment option for farmers which allows farmers to get 90 per cent of expected returns less the cost of the program at delivery. We have looked at taking over guarantees on initials and fianl payments so that we do not have to wait for government bureaucracy. We decided that this is not in farmer interest due to the costs of the risks. The above are only a small list of the changes made or reviewed since the farmers took over."

Speaking as a taxpayer, the sooner the federal quits guaranteeing CWB initial payments and a farm controlled contingency fund is set up, the better.

Others thoughts.

[TOM4CWB]

Charlie;

THE CWB could do back to back risk free trades with our wheat... in using PPO pricing options I know I am a CWB tax payer building the CWB contingency fund.

As the CWB has taken in millions into the contingency funds past few years... the burden has been large and unfair.

Now instead of pooling accounts distorting the market place, the CWB will use my own money extracted through CWB PPO taxes. I object!