Wednesday With White

[Hopperbin]

It is getting close to the end of the month at which time the sign up for flex pro is near. Just thought I would let you know that everyone I talk to don't like the flex pro, it is this deadline of July 31 that seems to kill it. If this deadline is supposed to give us a premium then where is our premium?

[TOM4CWB]

Hopperbin;

"Sign-up and pricing periods

Sign-up for the FlexPro contract begins June 23 and runs until July 28, 2008 at 9 p.m. Winnipeg Central Time (CT).

The pricing period runs from August 1 at 3 p.m. CT until July 31 at 9 p.m. CT.
FlexPro contracts that remain unpriced at the end of the crop year will be automatically priced by the CWB.

The CWB reserves the right to withdraw this program at any time, without notice, subject to market conditions....
After the start of the crop year, producers must buy out their contractual obligations if they want to reduce their contracted tonnage. The cost to buy out a contract will vary depending on market conditions. The nearby month of the relevant futures exchange is used to assess buyout costs.

The buyout calculation for an unpriced FlexPro contract is:

Pool Return Outlook – current FlexPro price

Plus a $1.25 per tonne administration fee.

The buyout calculation for a priced FlexPro contract is the greater of:

Pool Return Outlook – producer’s FlexPro price

OR

Current futures – producer’s futures

Plus a $1.25 per tonne administration fee.

For more information on assignments and buyouts, please view the information sheets.

Pricing damages

Pricing damages will be assessed on any shortfall tonnage at the end of the crop year. Damages are assessed based on market values on July 31, using the buyout formula.

For unpriced tonnes the formula is:
PRO – current FlexPro price
Plus a $1.25 per tonne administration fee
The administration fee is assessed to cover the cost of administering PPO programs. If a producer
delivers against a FlexPro contract, this cost is recovered through the basis discount. The administration
fee ensures the cost is recovered if the contract is bought out.
Negative values are set to zero when assessing buyout costs.

The CWB does not pay gains to the
producer since the CWB holds the risk associated with these programs."

WOW.

And President White... what about the risk the "designated area" grower takes on when they sign up... to a contract and PRO that is 100% determined by the CWB... not even by any discipline of a competitive market... or even arbitrage to international pricing!

What arrogant bunch of turkeys wrote this contract?

Do you not see why more than a few people are offended by this drivel... President White?

[parsley]

This week's comments/questions have been sent to Ian White.

I was a little surprised that more Agri-villers did not take the opportunity to state their opinions to be considered during the WTO talks.

Parsley