A new canola market?

[ianben]

Cargils man was asking for more canola in Brandon but with the condition of a guarenteed supply. Guarenteed supply or none at all!!!!!

Is this marketing opertunity we can fill?

I believe there are health issues with cooking oils and special canola oil could provide a solution for the fast food industry. However this must be available 24/7/52/03/04/05/06 at a stable price. Thats the way that industry works.

What is the value of this oil to the likes of MacDonalds with a brand and image to support?

Cooked in ********** canola oil to ensure your health!!! must have a value.

Could we exploit this value and price on value to customer. Fix a price and guarentee supply!!!!

I think this is fantastic marketing opertunity but can we deliver?

How many opertunities do we loose because we wont provide this basic service?

Lee tells of mustard customers who find supply unreliable and over priced so end up switching leaving to "none" option for producers.

We all know it happens with every comodity but can any of us do anything about it?

As individual farmers without help or guidance how can we provide the guarenteed supply or know the value customers place on our products.

The market is supposed to give us signals with price but this just compounds our reputation as unreliable if we switch in and out without information on customer needs.

More often than not leaves us with the NONE option and nobody wins.

How can we improve our reputation?

How should we decide what we grow?

Charlie Lee who is or should be responsible for getting this type of information to decision makers?

[charliep]

Just as a note, McDonald's does use canola oil in the deep frying processes here (no longer lard for fries/chips).

I hear you about the relationship between profitable prices and consistent supply. A couple of notes.

1) Very concerned about the changing of some vegoil/margarine labels from "contains canola" to "may contain" with a list of alternative oils.
The concern is not being able to meet customers needs and having them shift their loyalty.

2) An area that does seem to have some success is specialy trait oil canola. Their prices have been 10 to 25 % above the ordinary canola prices with some locking committing to 2 years. I will let others comment about agronomics/conditions of the contracts but seem to show some promise.

[charliep]

Here is the new canola market:

http://www.asx.com.au/markets/l3/GrainFutures_AM3.shtm

Australia to launch a new canola contract.

http://www.asx.com.au/shareholder/pdf/Agrifutures140203.pdf

France tried at the MATIF and it is not fluid (think flax).

Subject to regulatory approval, expected in the second quarter of 2003, Australia Stock Exchange will commence trading wheat, barley, sorghum, and canola futures contracts.

[charliep]

Larry - Western Canada needs a bit of the innovativeness and foresite Aussies show. They have grabbed onto the idea of more open pricing for wheat and barley with this just one step in the process. If the canola contract is successfull, it will suck a lot of volume away from Winnipeg (Aussies are active traders of WCE canola). Help.

[ianben]

Charlie
I read in Washington Post after McD were unsuccesssfully sued by three teenagers recently:-
McDonald's announced last week it would introduce a new cooking oil that has lower levels of trans-fatty acids, which have been linked to raising "bad" cholesterol levels.
Cargills statment may not be related but?

[ianben]

Charlie I agree.

Now move the Commodity Exchange to Calgary. Without liquidity from locals it is going nowhere fast.

The Aussies may have a Wheat Board but they dont act like they havea wheat board.

[charliep]

Ianben

Thought I would pass along this article in the Western Producer.

http://www.producer.com/articles/20030213/market_quotas/20030213mkt03.html

Can someone remind me of the class of canola Nexera and Inter mountain varieties fit into? LEAR. Maybe someone will develop a product that improves memory. Somedays I feel like a 386 computer with a 1 Gig hard drive trying to survive in Pentium 4 that requires 20 Gig of hard drive

[ianben]

Thanks Charlie.

Any possibility these special oil contracts will relate to the value these products will give fast food industry?

I am sure Cargills will know how to charge McD but will premium to farmers just be small amount over standard crop.

Is there an opertunity by fixing the price at a certain level to both guarentee supply and give farmers a decent return.

These varieties retail at $9/bu or we leave them in the bin?

[charliep]

Actually some of these contracts did offer $9/bu for 2 years. Will have to seek help from other Agri-villers who have signed these contracts.

I hear the concerns you have about being treated fairly in a value chain relationship. Seems to be the direction the market is moving. What things do you look for in your business partners to satisfy this need?