CWB EPO's

[TOM4CWB]

Melvill

I just checked the 100% EPO & it was $18.25/t for CPS/CWRW & 17.50/t for CWRS.

Why would anyone EVER buy this EPO?

Buying a call option next spring would give MUCH better market tracking, and the $263/t FPC gives either a 23/t premium over the CWB $240/t 100% EPO, or it will mean that the whole CWRS pool will have to go over $280/t before a grower will gain anything... and even then it will be diluted a huge amount because the CWB has already sold a huge portion of this years pool at lower prices!

How do I know this?

The $17.50/t premium screams it loud and clear.

SO... again why is the CWB charging so much... if they really are managing the risk on the pool... if they are not... (manageing the risk on the pool) why did they sell so much early... otherwise a simple hedge strategy should cost 1/4 of this premium to lock in a 100% PRO!

[TOM4CWB]

I just read my Agriweek, and 1CWRS 13.5 St Law. is $318/t this week, and was $316/t last week. And the CWB PRO is $258? How much grain did the CWB sell at teeth shattering low prices?

What happened to the CWB disciplined sell 1/12 of the crop each month of the marketing pool year? By the way, this 07-08 pool does not start moving till Oct 07.

Someone please explain what the CWB has done, and how they figure out the PRO!

How are we supposed to manage risk, if the CWB will not share what they are doing with our grain?

At $318/t port position, and FPC of $263/t there is a short fall of at least $40/t or a buck a bushel... missing from our FPC CWB prices.

SO the with the CWRS -$5/t basis & the Jan futures I locked in @$220/t... now this gives me $215/t instead of the $240/t to $260/t the CWB ACTUALLY is getting for my wheat with the futures I locked in.

[kamichel]

Well consider yourself lucky, I have to buy my fixed contract back. Dammm midge ate the whole damm thing.

[TOM4CWB]

Kamicheal,

Have you looked into delivering it as feed or #4?

If your wheat was put through a gravity cleaner or density seperator, are you sure you can't upgrade it?

[melvill]

tom4cwb, didn't read your first post here in absolute detail but I think you missed one thing in your EPO analysis. That is 'what is the cost of buying a call option on the Canadian dollar?' An EPO is two parts - put on wheat futures and call on Canuck Buck - because only part of the risk is related to possible changes in wheat futures prices. Lots of risk in the Forex market for the last quite a while.

[TOM4CWB]

Melvill

Lee the Job of the CWB IS to be marketing experts and MAXIMISE my returns. NOT MINIMISE my returns and put it in the pool accounts and contingency fund where it gets lost in oblivion/the black whole that prevents Market Arbitage.

We in Canada and Australia are being SO Ripped OFF. That is anyone with brain function and who cares about marketing

PERFECT Communist Left wing thinking.... better no one get anything... than someone get more than what I got... because I forgot or wasn't watching!

"2007/08 AWB Pool Estimates AWB have added another
$14/t to pool estimates this week. The new EPR is set at
$314/t. Given the sharp move up in Dec 07 futures, a $14/t
lift in estimates may be seen as surprisingly conservative.
However, we have to note that while Dec 07 futures lifted
$32.28/t, Dec 08 futures only lifted by $6.85/t.
What has taken off over the last two weeks has been the
forward cash prices. The lift in cash prices has been $69/t
with AWB and $84.50/t with ASX. In the physical cash
market the basis has improved by $36.72/t over the last 2
weeks, and now sits at -$10/t (Yesterday. Today it is $6/t).
This extra $36/t has gone straight into the pockets of those
who have forward sold using swaps. Those with fixed price
contracts have missed out on this $36/t - a big penalty to
pay."