CWB's little black book

[gregpet]

Again, what is the premium. The one determined by the CWB itself? Why is the internal audit be prolonged, delayed, avoided, etc.. by the CWB? What is there to hide?

[LWeber]

Hey Agstar

Thats Larry Weber

larry@webercommodities.com

How anon is that?

Everyone in the world knows what the bored sells grain for except western Canadian farmers. Commercially sensitive - right.

Send me an email from a real email account with your real name along with Agstar77 in the subject and i will forward you the email.

Two questions:

How is it that when the bored sells wheat, the rest of the world knows what it is sold for?

When you are checking those premiums, are you checking what the export bid/offers are?

[Vader]

Bucket,

Your remarks about the lack of foresight on the part of CWB marketers is astounding.

The CWB is still marketing wheat and durum at these incredibly high prices as evidenced by the fact that last months PRO rose by nearly a dollar a bushel.

CWB PRO's for durum are $2.20 per bushel higher than the reported weighted average selling price in North Dakota and $2.47 higher on spring wheat. An interesting comment I heard directly from one American farmer was that the frost in Kansas kept him from filling his 2007 contract and now his 2008 production will be going to fill his 2007 contract at values below $5.00 per bushel. Another American farmer told me that they are afraid of forward contracting any significant portion of their crop for fear of a repeat of last years frost.

Farmers in North Dakota saw spring wheat prices climb from $5.00 in August to over $7.00 in December and sold the vast majority of their grain at prices that were at that time not only attractive but profitable. Durum wheat prices over the same period climbed from $7.00 to $13.00. The reported weighted average selling prices for North Dakota farmers is $6.50 for DNS 14 and $10.45 for #1 HAD. The North Dakota farmers who sold in that time frame did rather well pricing into those rising markets not having the hindsight we have today.

The CWB took a different view of the market and a more disciplined approach to selling and gleaned a substantial premium over these reported weighted average selling prices.

Bucket you say that the CWB cost you billions of dollars. On the contrary the CWB earned you (the farmers of Western Canada) Billions of dollars. In fact on a 5 million tonne durum program, using a premium of $90 per tonne, and a 15 million tonne wheat program, using a premium of $80 per tonne that calculates into a premium of 1.65 Billion Dollars.

You can argue that the PRO's may change between now and the end of the crop year. Our dollar may continue to appreciate against the US dollar which would erode premiums. The commodity market may cool off and the CWB may not be able to sell the remaining stocks at these high levels. In fact buyers are few and far between at these lofty levels. The figure of 1.65 billion may be somewhat optimistic or the markets may move the other direction and the number could go higher. A few more days and we will see the March PRO's which will give us more certainty about the remainder of the marketing year.

No matter how you slice it. It has been a long time since a cash infusion of this magnitude has hit Western Agriculture. And it has been probably 30 years since this amount of additional cash has come to the farmers of Western Canada from the market sources rather than the Government.

The CWB Rocks!!!!!

[Fransisco]

And how'd you do against the simple average price?

[Fransisco]

I know that when it comes to malting barley you haven't been able to beat even the simple average price when comparing farm-gate returns between Alberta farmers and the Golden Triangle in Montana.

You're not doing anybody any favours out here Rod/Vader. Give it up and let us sell our own grain already.

You have no moral argument and you have no economic argument.

[Fransisco]

And oh yeah...

THE CWB SUCKS!

[Fransisco]

While we're at it Rod, you have no credibility until you go public with your little black book. As long as you keep the numbers and methodology used a state secret no one has any reason to believe you.

[Vader]

The simple average price is irrelevant. The only thing that matters is what is actually sold. Does it matter one iota that the Minneapolis futures got up to $25.00? Duhhh. Well NO!! There was no volume done at that value.

Does it matter when the spot market for old crop flax goes through the roof when there is virtually none left to sell? We've all been there. Those values only happen after the majority of the crop has been sold.

Why do you insist on quoting spot prices? Because it supports your flawed analysis of the Boards performance. No matter that it is entirely flawed

The individual CWB sales values are irrelevant to this discussion also. What is relevant is at the end of the year, how much was sold at what price. That is exactly what is reflected in the PRO's.

[bucket]

Vader

My wheat is still in the bin and you just got finished saying the cwb is making sales at these high prices. Good - just show me the money.

My peas were in the bin and I got shown the money - 12 bucks a bushel.
Hauled in and no waiting a year and a half for the rest.

I don't like financing a team of incompetent people.

And maybe you could confirm the sale of old crop wheat to Iraq for $2 per bushel below the US new crop price.

Put the facts out there and people will judge if you are getting a premium.

[Fransisco]

Okay Rod lets have a look at what you got here. You want us to compare the PRO with the weighted average prices in North Dakota.

1. Can you provide us with a link to this USDA data that you are referring too?

2. And a link to an explanation of how the weighted average calculation is done?

I found the national numbers but have yet to find the North Dakota data set. As far as I can tell from the national data set it is based for sales on all classes and grades of wheat combined. It doesn't look like they separate out 1's, 2's, 3's and the various protein levels.

If that is indeed the case which CWB class and grade do you propose we compare too? I would suggest it would have to be all of them to be a fair comparison.

[Fransisco]

And by the way the simple average price is not a "spot" price, it is an average and it is highly relevant especially when you can't beat it.

[Vader]

ooohhhhh a simple average is not a "spot" price. It is an average of the "spot" prices. ooooohhh

[Fransisco]

Okay lets see the USDA data Rod/Vader. Where are the links?

[gregpet]

Vader, Agstar still no response if my information is correct or not. Aresponse would be nice.

[Hopperbin]

Vader what is wrong with quoting spot prices. So where then did all the money go from selling all the fixed daily price wheat for under net to the farmer. So the Pro is likely 1 to 2 dollars per bushel higher than it should be because so many good farmers donated from their bull shit fixed priced. These books need to be opened.