Viterra To Prosper

[Hopperbin]

Chuchchuck how would you explain the low price 3.48 net to producer on CWSWS wheat fixed price contracts? Obviously the CWB is not doing any sort of job here.

[LWeber]

QUOTE
With a little research on the internet it is possible to compare 2007/08 grain prices net to farmers.
UNQUOTE

Stop spewing from your speaking notes.

Do your own due diligence as cotton says and if you do not have the capacity - how do you know when there is a premium or not?

It has nothing to do with Kraft or 10 other economists. The evidence is there for you to discern.

Advise this forum the results.

[chuckChuck]

Mr Weber,
I have presented numbers wich are publicly available. I have referenced academic sudies which are part of the public record which you discount for no apparent reason. Along with the sales data presented to actual board members there is s strong case for the benefits of the single desk. Where is your evidence to the contrary? Sorry but you have to make a better case. I have done little work here, now it is your turn. Show me your numbers and make an argument.

[LWeber]

You lead this forum to believe that you did the work to compare last year's durum price using publicly available numbers.

QUOTE

With a little research on the internet it is possible to compare 2007/08 grain prices net to farmers. Lets take a look at durum. The USDA numbers show the weighted average durum price farmers received from June to May 2007/08 was $9.75/bu.USD net to farmers.
The # 2 CWAD 11.5 % protein PRO as of October based on 2007/08 August 1 - July 31 crop year was $12.38/bu. CAD (average net to SK. farmers). In order to fairly compare prices you would have to adjust for the 2 month diference in the timing of sales, currency, slight grade differences and the market advantage that US farmers have in higher domestic usage (say 50%)which translates into higher net returns because of proximity to US mills in contrast to our more distant markets which net us less.

UNQUOTE

If you did this work yourself, you have the capacity to go back and look at 5-year results using the data that you referenced above. Publicly available data

What are the results from a 5 year comparison - or are you reading speaking notes?

[charliep]

chuckChuck

In doing your work, did you adjust for differences in crop years between the US weighted average price and the CWB pool returns (average prices)? Did you include the 3.4 mln tonnes of wheat that was priced under the fixed price/daily price contract for under $7/bu? If the same analysis for the previous 5 years want would the results be or would you bring out the logic on page 8 of the Sept. 8 CWB response to the Informa Economics study.

Every time I see reference to the magic numbers the operations side of the CWB shows the board of directors, I have to ask what due diligence the b of d does to check these numbers?

[parsley]

I, too,would like the 5 year results... to post on my blog.

I'm waiting. Pars

[TOM4CWB]

Chuckchuck,

The massive THEFT of millions of $$$ from PPO flat pricers Basis alone is enough to make any CWB based figures suspect.

You can fool some of the folks some of the time... but saying it over and over does not make a deception/lie the truth.

We went through the CWB benchmarking process... and the CWB gave up... because it proved the point that they were not competitive.

Same goes for the DPC failure and removal... with the resulting institution of the Flexpro. A pure and simple practical sign that the CWB simply cannot compete with the competitive system that extracts value... where the consumer/buyer and farmer can create that value for each other.

Personal relationships will go a very long way to providing value... and creating prosperity for both sides production and consumers! To argue otherwise ignores basic economic principals that have built our western civilisation... and the very system the CWB calls the 'US Premium' market.

In Canada we have a 'Canadian Premium Canola Market'... which pays more than the US market for Canola seed taken over the crop year average.

Chaffmiesters post put it well... read it again.

[TOM4CWB]

Here is a very good explanation Chaffmiester posted to timm;

"Nobody, not even the "experts" at the CWB with all their market intelligence can forecast the market precisely and pull the trigger at the top. To criticize individuals because you don't think they can do better than the CWB is not only insulting, it misses the point altogether.

The CWB does not add any value to grain marketing. No premiums, lousy market timing, high costs, poor logistics, injures non-CWB markets, discourages investment, etc, etc. Don't even begin to bore me with ANY counter argument. It's non-debatable.

And don't bore me with the pedantic argument that you don't have to grow wheat and sell it to the CWB - "Grow something else". Trouble is the impact of the CWB is on the whole system, the whole economy - not just on wheat and barley.

This is what makes the single desk "authority" over grain growers so exasperating. It does a lousy job - and the ones that see that have no choice but try to change and improve it.

Many talk about it just being about freedom. It's more than that. It's about the dignity that goes with accepting the responsibility for your own livelihood. Whether the CWB helps or hinders doesn't change this basic premise one iota.

But the fact that it does INDEED HINDER and frustrate personal efforts to prosper, makes it that much more unacceptable.

Whether people can pick the tops of the market for themselves or not is such a stupid argument. Especially when the CWB can't do it.

If you can't see how the CWB is an albatross around the western economy's neck, that's unfortunate for you. But ignorance does not give you the right to force your neighbours to accept an unworkable system."

[chaffmeister]

I don’t like comparing to USDA weighted average data for a few reasons:

1. The crop year is different. Using data from June and July of 07 and not June and July of 08 skews the averages dramatically: it raises the US price by US$1.95/bu. Not such a big difference anymore, eh chuckChuck?

2. The USDA data includes all grades delivered in the period. Comparing this to the net return of one Canadian grade is analytically wrong; presenting it as a relevant comparison is disingenuous and deceptive.

3. chuckChuck – you suggest the US farmer has a “marketing advantage” in that the US domestic market pays the US farmer more than the US offshore market. Are you saying that there are two prices – one that the domestic buyer pays and one that the export market pays? You pro-CWB types always argue the “law of one price” would prevail in the absence of the CWB. But not in the US? You can’t argue it both ways.

4. Perhaps what I dislike most is the idea that we should compare the CWB actions to what US farmers have done. Why do we care what US farmers may or may not have done in their marketing? What I care about more is what the CWB has done when compared to what opportunities the market was presenting.

The average DTN index price for #1 US durum in 07-08 (Aug-July) is C$13.82/bu. The PRO for #1 Cdn 14 durum in SK is C$12.60/bu. This puts the CWB street price about C$1.22/bu below the US average street price.

There were great opportunities to make some very high priced sales in 07-08. But the CWB’s end results were below the average US price. Where’s the CWB advantage? Shouldn’t the CWB do better than average?

If you sell in the bottom half of the annual price range, who’s doing a better job – you the seller, or them the buyers? The data shows that the buyers do a better job than the CWB. And you call that marketing clout?

Five years of comparisons: CWB (SK street price) vs DTN (US street price index):

03-04…………$0.40/bu below US average
04-05…………$0.42/bu below US average
05-06…………$0.22/bu below US average
06-07…………$0.35/bu below US average
07-08…………$1.34/bu below US average

<b>The year the CWB is bragging about is the worst in five years, when you compare it to average marketing opportunities.</b>

And if you were wondering, the current 08-09 durum PRO is C$5.07/bu below the US average price (so far).

[chaffmeister]

Sorry - point umber one above should read:

Using data from June and July of 07 and not June and July of 08 will – on its own – skew the averages dramatically. Using USDA data for the Aug-July period raises the US price by US$1.95/bu.