CWB December Pool Return Outlook Released this Thurs.

[charliep]

Just a note to watch the Pool Return Outlook released this Thurs. (Dec. 18). Using the posted PPO prices as a guide, the wheat ex durum PRO will be down at least $20/t (Nov. 28 converted price of $250/t versus $230/t yesterday - source: http://www.cwb.ca/db/contracts/ppo/ppo_prices.nsf/fixed_price/2002_index.html

I think the PRO should even come down depending on what the portion of the pool has been priced with a $30/t drop not unrealistic.

Durum - No opinion other than down with spring but not as much.

Malting barley - Very interesting signal as to amount available versus already priced in the pool. Should be increasing but....

Feed barley - Who cares - totally irrelevant (unless you want to participate in the $8 mln interest lottery).

[TOM4CWB]

Charlie;

I don't believe the Cash price is following the futures price down on a one to one basis.

THE US/North American CWB price for a 1CWRS 13.5 has been about $293-$295/t for the past week, which clearly is nowhere near the $230/t the PPO price indicated... are you sure that PPO pricing is a good indicator of what the CWB actually is getting?

I see the #1DNS is CASH $5.02US or about $290/tCDN ... maybe we will be at par with US PNW pricing this crop year since the CWB obviously does not need to price discount into world markets because of very small CWRS high quality stocks?

[TOM4CWB]

Charlie;

"DATE: December 19, 2002

Wheat and durum down, designated barley unchanged

Winnipeg -- The CWB today released its December Pool Return Outlook (PRO) for the 2002-03 crop year. Wheat values are between $7 and $12 per tonne lower than the November 2002-03 PRO. Durum values are down by $4 to $7 per tonne. Feed barley values are down $5 per tonne while designated barley values are unchanged."

The #1CWRS 13.5 is $286.00

This proves without a shadow of a doubt that the July PPO contract Basis charges were a ficticious unfair tax on farmers who did the PPO contacts... IMHO.

[charliep]

Either the CWB has used the fall higher fall prices to sell significant portion of this years crop or my suspicion is there is still a lot of optimism about price potential over the winter. Still wish farmers/advisors had a better understanding of the priced portion that used in the PRO calculation and a clear separation of what the market is offering today for unpriced grain versus the forecast the CWB may be using in determining the PRO. How much is hedgible reality and how much is wish thinking/forecasting?