Ontario Millers' Association says a dual system is dysfunctional because the price of wheat goes up!

[AdamSmith]

One other point relating to the above topic;

I am aware that the Grain Growers of Canada have developed a proposal that appears to be loosly modeled after what Ontario has.

The GGC proposal suggests;

1. A deregulated domestic market for all wheat and barley ie. no limits placed on domestic marketing.

2. A 25% of marketable supplies export exemption. ie. if there were 15 mmt of wheat available for export, 3.75 mmt would be allowed exemptions from the current system.

Would the millers accept that type of arrangment?

and to thalpenny, as I'm also aware that this proposal has been shared with the CWB brass, what is the CWB's position on this proposal?

AdamSmith

[parsley]

AdamSmith,

The grain belongs to the farmer when it is grown and the grain must belong to the farmer when it is marketed and there are a whole lot of farmers out there NOT prepared to negotiate a "percentage freedom".

Simply put, when export licenses are applied for, the CWB must be prepared to grant them to all Prairie farmers that apply for them. I do think there will be farmers who will continue to market through the CWB and not even apply for licenses, but for those who do want them, they must become available. No percentages. No backroom diddling.

Absolutely nothing else is acceptable, Adam Smith.

Parsley

[TOM4CWB]

Adamsmith,

Just a little understanding of the Ontario situation, farmers want to dispose of all their wheat before the bean and corn harvest in the fall, as do the commercials generally speaking.

Therefore those who spend the time and effort to store this grain into the new year expect to be paid for the risk of storing this grain, which includes the farmers.

Since the mills don't have sufficient storage, sometimes they get caught and "squeezed", as they would say.

Everyone wants free storage, at no risk, and with no carry, but this isn't how the world works, when it is all said and done, you can't get something for nothing!!!

There is much more to this situation, it would be nice to hear from a broker to hear that side of the story!!!

Again, they, the farmers, brokers, or OWPMB can't charge more than fair market value, or the millers would simply import from the 50mmt pool of wheat that is avaliable each year in the US.

So much for the CWB's theory that only a single desk can extract a premium!!!

Looks like the millers like the single desk, cause they get many services at no cost, if they are shrewd enough negotiators!

[TOM4CWB]

Adamsmith,

I made a mistake, on the storage, carry, risk, western "designated area" producers don't visibly get paid either, and the perfect example is that my neighbour who has a unpriced CWB basis contract, for 2001-02, supposedly owes about $27/t to get out of this unpriced contract, just to let it go back to the pooling account...

SO the CWB expects us to pay, and we "designated area" producers pay for storage at the elevators to hold wheat for the millers... through the pooling accounts... NOT like in Ontario... where farmers and brokers/elevators get paid to hold the grain for those who need it later...

Now who is being treated fairly, and who is not?

[AdamSmith]

Tom4;

If your neighbours contract is a CWB Basis contract and he has not yet pulled the trigger on the price, he should be able to get out of the contract with just a nominal charge.

I believe I asked about this and as I recall, either $2/t or $4/t was the charge that the CWB info guy told me back last summer.

But I guess like everything else at the CWB the rule is, there are no rules.

But speaking of CWB pricing options I had the misfortune of trying out that same basis option with my CWRS.

#2 15.5 CWRS will fetch me $4.00/bu give or take a few cents.

I sold most of my CDC Clair winter wheat into the domestic feed market throughout the winter and I recieved $3.85 FOB farm.

I still have a couple of superB's of the stuff and I'm sure I can get $4.25-$4.50/bu FOB farm Manitoba. Unless I hold it back for seed.

Needless to say I won't be using that program again and I would reccommend that others steer clear of the CWB's new pricing options.

So my own real world experience would suggest the CWB system loses my farm money. Under the domestic quasi-free system I made some money and a broker, even made dime.

The CWB and the flour millers call that dysfunctional.

I call it wealth creation!

[TOM4CWB]

Adamsmith,

I may need some winter wheat to seed on my written off canola land, so don't dump it yet! Lots more like me, especially if rain doesn't come real soon...

I see the OWPMB pays $.07/t/day from Sept 1, $2/t/month wouldn't be bad, would it! Maybe the CWB should get the hint!!!

See the string on PPO's, I think the CWB is in a real squeeze, and big problems are coming home to roost...

They don't want big transfers into the 2002 PPO's of 2001 wheat, so they messed everything up to save their own hide... a totally disfunctional system that has no basis in reality...

What else can we expect from folks with such a.... view of marketing???

A person can make money from this PPO system, but it is at the expence of other farmers, and is wrong and immoral, so I agree avoid the PPO contracts....

[TOM4CWB]

Charlie,

I just read the terms and conditions of Agents for storage of wheat for the OWPMB @ http://www.ontariowheatboard.com/2002-04%20Agent-storage-app.html

I do not see how the agent can extract an amout more than what the OWPMB sells the wheat for under this storage contract!

OWPMB retains ownership and gives shipping instructions to the storage agent.

OWPMB also pays the agent directly for the storage at $.07/t/day.

Now what exactly is thalpenny talking about, I don't get it.

The only way a broker could raise the price of the wheat, is if the OWPMB had sold the wheat to that broker first, and then that broker is responsible for the market risk, either up or down, and the OWPMB pooling account no longer has the market risk.

And if anyone says that the broker can predict the market and skim extra off the top, they should try to be a grain buyer, and just see how much money their is in the grain business... just ask Nabors...., These people are hard working farmers who were trying to help other farmers... and what did they get..., not a big swiss bank account, just a wrecked farm...

I guess I should start a string on CGC bonding...