Truly ugly grain prices

[charliep]

Perhaps this highlights the importance of having
cash flow and delivery needs thought out well
ahead of the fall and arranged through contracts.

It also highlights a good in that it appears that
grain companies are putting priority on taking
delivery of signed contracts first and spot sales
second. You guys will bring me up to date quickly
if I am wrong but a year ago there were a lot of
early fall canola delivery contracts that got pushed
into mid winter. Grain companies should be
accountable to delivery periods the same as any
farmer realizing stuff happens.

[checking]

Then get it first hand by checking it out yourself.
You do have a good point about picking up the forward contracted grains first. However; it has yet to be proven that contracting will be the salvation for farming profitability. There's an outside chance it will ruin some or many farmers if world economic woes stabilize at todays 60% off values; let alone the possibility that much worse may very well happen in the next short while.

[checking]

I get the distinct impression that not one person has ever looked at the Viterra website; and certainly not in the last couple of days.

[charliep]

I did look at Wednesday but not Friday. Have got comments on oct/nov canola but I haven't checked the reason. The IP canola in particular does not make sense. The edible yellow pea price was closer to $4/bu in select alberta points for next spring.

As Ron indicated, important to check with your csr.

[checking]

Thankyou for confirming what was said in the first post.
I did say feed peas at <$3.00 and never made any mention of edible peas.
When a company puts out price quotes; they should make sense and be accurate. What is published is a reflection on them; and if they wish to explain or apologize for any errors; thats in their court.
Just because I don't have a clue about what drives the markets doesn't mean that my gut instincts aren't as close to histories outcomes as those who spend their time trying to figure out the latest high finance scheme.
Please enlighten me what a "csr" is.

[Ron]

Customer service representative is a fancy name for a grain buyer

SCREW THE CWB (I know its not a cwb post but I love saying it)

[furrowtickler]

Regardless of what all the price quotes are, those prices are far below profit levels. I will be spraying more chemfallow if it does not change. Do not much cah flow for that.

[checking]

Totally agreed.
Another general way to approach the future is to not sell what you have in the bin for less than what it will cost in inputs to replace it. While many will argue that they need every cent for cash flow (no matter what the price is) and that they can't afford to build bins etc.; the truth may be that they also can not afford to not do things differently. The government won't be there in the future to bail everone and everything out.

[jensend]

a couple of interesting links:

http://business.timesonline.co.uk/tol/business/economics/article5014463.ece

progress.org/fold48.htm


makes you wonder if one strategy might be to sell inventory because if all price levels drop you would have sold high and later be buying low.

[furrowtickler]

I hope that is wrong, b/c if this is the high we might as well just walk away now while the farm is still worth something.