50 dollar flax

[charliep]

No doubt about being exciting times. As highlighted before, I try to orient my thinking to understanding and making decisions based on risk analysis (both benefit and negative consequence). My suspicion is that the market would not go straight to $50/bu (or the actual high) but will move up and down.

Not taking away any seller right to withhold crop from the market to get a better price but also highlighting the need for daily opportunity to trade. A buyer who has just in time storage has to be able to enter the market on a regular basis to purchase what they need. Also note the limitations on movement within Canada. For example (haven't run the number recently), capacity on the west coast (Vancouver and Prince Rupert) is about 1.75 mln tonnes. Implication of both the above is the system has to have a steady flow of product.

[charliep]

The 1.75 mln tonnes at west coast is monthly by the way - 21 mln tonnes annually. Others will have a more precise number.

[mbratrud]

Sounds like a fair number to me!

[charliep]

Just to put the numbers side to flaxseed, statscan estimates that farmers seeded 1.5 mln acres to flaxseed this spring. Assuming an average yield of 0.5 tonnes/acres (20 bu/ac) would result in 750,000 tonnes. Disappearance has averaged about 800,000 tonnes (600,000 exports and 200,000 domestic). Carryin end of July should be about 100,000 tonnes which is pretty much empty bins. Supplies are no doubt tight/will require some type of rationing.

As a note, Europe represents about 80 % of the Canadian export market.

[parsley]

Domestically, there are very few of the bigger Canadian grocery stores that don't carry consumer sized bags of flax.

If 30 million families have a bag of flax in their cupboard, demand will grow. We need to convince Chinese citizens they need a bag of flax in their cupboard, too.

Parsley

[charliep]

parsley

Agree 100 %. Note that flaxseed is worth $50/bu if you satisfy a consumer need. The consumer need is flaxseed's health benefits (plus maybe some organic premium).

Just out of curiousity, how many look at food ingredients at the local grocery store?

[parsley]

Did you ever go into a large grocery store and watch people shop? I have.
More and more, shoppers read labels.

I note that many decision makers feel the urge to "educate consumers."

However, if they went into a store and watched how/what consumers select, it is indeed the decision makers who will also be educated.

When I was in Minneapolis, there were were pollsters right in the malls, asking about what/why/how much/ you purchased. Various products. ie "What was the # 1 reason that prompted you to you buy this product?"

In NYC, in the most expensive specailty grocery store in the world, I noted intent label-readers. Money was no object. Where it was grown and how it was grown was the focus, after content. Ingredients are crucial.

If you make 20Million a year, you don't care if you spend 5 thousand on food or 6 thousand.


If you make 2thousand a year, price becomes the overiding factor.

The question is this...which group do most Canadian farmers want to target and sell to?

Here I go harping...listen to your consumer. If they don't want red dye in the icing on their forty dollar birthday cake, the baker is dumber than a bag of nails if he argues.


CANADIAN FARMERS HAVE EVERY OPPORTUNITY TO ESTABLISH THE FOOD THEY GROW AS THE DIAMOND SOURCE OF FOOD IN THE ENTIRE WORLD.

DIAMOND SOURCE.

And I think that is pretty damned amazing.

Parsley

[Fransisco]

Wow, forecasts based on inflation, the master at work folks.

What are you looking for cotton the "Christopher Columbus" award for discovering something that already exists?

Lets take a stroll down memory lane and see how well tricky Nickie's promises held up...

http://www.youtube.com/watch?v=iRzr1QU6K1o

That was an historic moment, Nixon severed the last ties of US currency to gold and joined in the "fiat" frenzy that still goes on today.

[cottonpicken]

Nice to see you catching up fran.

That puts me about four years ahead of you.

What were your price projections?

What were others price projections?

[Fransisco]

Riddle me this, oh wise and humble one.

A. Why do you think long term price projections are so important?

B. Why do you hang your hat on them?