Cargill meeting in Regina kind of says what's next for farmers and it isn't great!

[SASKFARMER3]

I didn't go but got the info tonight from a few that
did. One speaker on why we farmers should
contract with grain companies a year out or more
to book delivery and basis. Hm . Talked about the
USA system how farmers book delivery and use
puts options futures paper etc. but it seems he
forgot one thing in the USA the grain companies
have huge inland elevators not the joke kind we
have in canada. Check out Salina Kansas etc. so
yes if I was a USA farmer haul in off the combine
say 70% of expected production bin the excess
on my farm. But then it's in their facility if I like
price sell or play with paper etc but I can liquidate
and get paid for my product any day.
Now in Canada the grain companies have no
storage but farmers do and most is pretty darn
good. So let's tell them all to contract a year or
two out to book delivery into their system. We
store for them so basically take away any
prospects for a price spike for us. Unrealistic
basis so were always a dollar or two out of sink.
They don't need to build any more storage that
would cost them.
Between the railways and the grain companies
were going to get it even worse in the future. If
anyone else attended would like to here your side.
Because I always said when farmers have cash
and aren't at the mercy of the markets the big
boys are scared but when we're begging they win.
Wouldn't it be nice to see how well the companies
did this year in a year from now. I think it won't be
red ink!

[seabass]

Just keeping the minions in line. "Gru" ahem Gerry
Ritz can't let us get to rich and powerful.

[Klause]

The US has bigger elevators... but look
at the bushels they produce per acre?

160bu corn 40bu soybean averages...

Our wheat average is 35 canola 32 oats
75 barley 60... Way less storage
required... The are efficient at moving,
and yes US farmers contract out for a
long time ahead, buy back on paper,
etc.

I have no problem doing that, and was
hoping we were going that way. My
problem is a -70 basis for next fall.

Guess I shouldn't complain... we've
moved as much as we want to before
seeding already anyway.

[SASKFARMER3]

But my friend the winter wheat in Kansas goes
directly to town and they can get paid on the spot
or play. Here it sounds like the companies want
that but we store and own the product till they
decide when they need it. We will get to where I
want deliveries by end of March but hate the
delay game that's happening.

[Klause]

Relax... the industry is trying to figure out how all this will work....


what it "sounds like" is open to personal interpretation... We aren't going to grow
60mmt of grain every year. If we were growing 40 we'd be darn near shipped out


We need to work on logistics. Not just grain handle, national logistics.

[SASKFARMER3]

Yes I do agree a smaller crop and we'd be
impressed at what's gone. But now some seem to
think we'll grow the same crop this year again. Oh
we'll well see. This week was a great week to haul
fert and hrs. Oats $4.95 delivered to Iowa I think
that's usa money really considering that.

[Klause]

Load in sothern MN.

I got a 3.75 bid out of Mt US
Commodities, check them out.

That was picked up S. AB and SW SK I do
believe so if you haul there and cross
load it works.

[Daylate]

Ok, back to original post... anyone that was there
can chime in, but creepishly like sf3 I was at a social
event tonight with a friend that filled me in on the
meeting of Cargill that he was at. We were both
working the bar so we had lots of time.......
So to fast forward to the end of the night and our
conclusion was paper money can definitely create a
bottom to sell into and limit losses or create net
worth but........ REMEMBER you have to stay at the
top of your game within your industry! Know who
your competition is!!! If that means your competing
with someone who can wait a year and a half to sell
his crop with nothing but storage, and you have to
compete with that same guy to expand your land
base buying or renting land then, playing it safe
doesn't work. Therefore all your doing is giving
other people your money to try and hang on, in
hopes that guy with money has a little mercy.
End of 2 day meeting was store it and put equity on
the line to hold it.
BIG BINS, 4miles of bags, whatever,
Most prosperous guys in our community market
grain like they drink. Binge drink and Binge sell!!!

Just my middle of nowhere Saskatchewan take on
that!

[malleefarmer]

dumb question in my wild days of carefree footloose living spent time sask alberta and bc in 83 and 95 could get over the change in infrastructure meaning elevators just abandoned and rotting and nothing was replaced but visiting farms saw all the onfarm storage and got the picture but you guys couldn't believe the Australian system of harvest and deliver same day a common commnet " good to get rid of your grain but you have no control over it" well that's changed 100% now in aust so maybe were not so bad, downside once its in there at many super sites you cant get it back out, will explain if people are interested

[SASKFARMER3]

I agree Mallee Once its in their its theirs. But yes in Canada The farmers build huge on farm grain storage the Elevators build throughput elevators meaning dump store a bit make on elevation etc and ship. Well the Shit this year proves the system that's in place doesn't work the Grain and Railways screwed up and their blaming the farmer.

[bucket]

What Canadian farmers don't get is that the graincos are making money on your grain sitting your storage.

To book loads for october and november and have it delivered in febraury, they are not and won't pay storage.

They have the value of the contract so they control the grain if they raise the price between delivery they make the profit.

If it sat in their storage and the farmer used paper or different pricing, like in the states, sure it in the graincos storage but the farmer owns the grain and the gain/loss until he cashes up.

[farmaholic]

Bucket: As I said in a different thread,
after the contract grace period for
delivery is up, tell them you're bringing
it and bringing a swing auger. Ask them
where they want it. Don't make a pile on
the drive way. Could you imagine making
a flax pile for them!! LOL.

Cheap talk.

[bucket]

Right.

The better solution is for graincos to
build the required storage and have
grain ready near the transportation.

Its idiotic for farmers to build
warehouses. I would rather have condo
space at 3 elevators and haul when it
makes sense. Then it becomes a phone
call and refill when it schedules in for
me.

None of this constant train is late or
reassigned bullshit..

[malleefarmer]

there are quite a few farmer owned storage sites popping up across Australia mostly bunker site with tarps.

I can deliver grain to A class B class sites here there is a c class but not near me.

A class are "super sites" Im lucky enough to have one 28 kms away has 7 grades of wheat 6 grades of barley and one grade of canola

Super sites offer cheaper cheaper charges and warehousing costs but catch is there export only sites and ones grains in there cant be shifted out, wereas b class sites if I wanted to take out 100 tonne of wheat to a dairy farmer I can with a loading costs of course. Cost of storing grain is 50 cents per month for first three then $2 per after tha I think so can store no insect worries etc and sell to whoever when I want but again goes to a expoter.

from my site its railed to port

back to my point a lot of farmers are building sites next to rail lines to compete mostly in next state and can supply export market or domestic can be risky get a drought year have same costs less tonnes can come unstuck for new sites without capital reserves

[Hans]

Maybe the current situation will encourage graincos to invest in additional storage. I'm sure they wish they were profiting from it this year.