Attention: Feed Barley PRO on Thurs.

[charliep]

Just a note to pay attention to the PRO on Thurs.

Rain has made the comment (I aggree) that the export feed barley market will have to be in the mix this year for Canadian feed barley exports.

What I know.

1) The feed barley market has potential to be ugly this fall as farmers try to sell into a demand vacuum. Minimal placements in feedlots/an industry in termoil will start has/will impact feed grain prices.

2) Current PRO (June - watch Thurs.) for feed barley is Cdn $123/t port or an Alta based forecast of $80/t ($1.75/bu if its easier). Assuming the initial is set at 75 % of the June PRO, intial based port would be $90/t or Alta. $45/t ($1/bu).

3) Phoning around grain companies/exporters seems to put international feed barley prices in the US $115 to $125/t range FOB west coast equivalent (applies to both Saudi and Japanese Food Agency business). Bottom is the most likely tradeable area. There is business to be done with Europe and Black Sea countries (FSU/Ukraine) more or less withdrawn as they access impact of their drought/poor crops.

4) Based on the above (US $115/t) and a 70 cent loonie, this price would convert into a Vancouver based price of Cdn $164/t loaded into a vessel. The deductions to get back to Alberta would be $7/t fobbing (cost to load ship), $5/t cleaning, $1/t weighing and inspection, $25/t rail freight, $12/t elevation, $5/t cwb pooling costs or deductions of $55/t. Access to this market today would provide a price of about $110/t (perhaps more) based central Alberta for September delivery (in port October). I will let others comments how this price compares to new crop non board bids.

5) Notes. There are sales opportunities at these levels in the fall but they may not carry into the winter as Australia harvests crop/enters the market. The signal the farmer gets is poor/non existent about the world market. The CWB will not sell anything to export market until they are comfortable with the farmer contracted volume. No sales made. When farmers do contract and the CWB gets around to selling, prices are lower and the crummy initial payment/forecasts are a reality.

Interesting.

[crusher]

Charlie, thank-you for continually starting new threads and getting my brain in gear. Just because many of us don't reply doesn't mean we aren't paying attention.

Your summary sounds like Tom wrote it for you (ha ha). When is the high and mighty CWB going to help us with some actual marketing of our crop, rather than providing some window dressing like larger advances?

Also I see what are at the end of the line for PPO for the crop year. Any comments/opportunities that you see?

[crusher]

Sound like anouther profitable year with 40 bus barley. Just can't wait to go pay half my bills. Nobody's falt, just my 2 cent's.

[rain]

Remember as you read further into this I am not a supporter of the CWB.

This year with everything as bad as it is going into the fall, Canadian Barley producers should consider contracting 15% of this years barley crop the CWB as feed.

Right off the top whether your are growing malt or feed barley is the first marketing decision was a 15% commitment the fundamentals for feed barley would look much better with 15% of the crop gone.

[TOM4CWB]

Charlie;

It is obvious we need a spot cash export price to make export sales work, and get decent quality supply of barley into this market.

We MUST get over the "Pool" roadblock, how can this be done?

If we are in for a 7 year BSE problem, and a 30% reduction in cows, don't we have to fix this barley issue, as barley cannot be exported as beef or cattle any more?

[TOM4CWB]

Charlie;

Feed barley export prices are not that far off the CWB malt PRO, and the CWB will be unlikely to call attention to just how badly it sells malt barley, by offering decent cash export feed barley prices.

Besides, our "designated area" domestic livestock can't afford too, and won't compete with the export feed market, ...Isn't this the real reason the CWB monopoly is STILL on feed grains? Is there any wonder why the CWB is gaining in popular opinion, how many mixed farmers growing livestock hold permit books?

How can farmers who choose to grow straight grain, ever overcome this electorial wall?

[charliep]

Feed barley PRO went up by $2/t on new crop and down $4/t on old crop. The old crop is perhaps the most interesting. How can can the price of something that is an average pooled price for whole go down on what is 11 th hour?

[charliep]

So they can balance the Wheat Pools.

[TOM4CWB]

Charlie;

Stock switches with elevator co's, or Larry is right, the CWB is transfering interest churning revenue through the grain co's into the wheat side... it will be interesting how much acc. interest earnings make it to the Contingency fund this year!

By the way there must have been some C series feed barley just bought by the CWB, right Charlie?

[charliep]

How is the $8 mln of interest earnings from old barley sales being handled? The CWB talked about seeking advice from farmers this last winter. Was this done? Is some portion of this interest earning included in the feed barley pool return? Or was it, as you indicate, allocated to other pools to look after deficits and minimize tax payer exposure?