Reflecting on price and protein premiums received by farmers from the single desk CWB

[vvalk]

The Canadian Wheat Board always received a premium for 1CW 13.5 protein wheat out of Vancouver over US dark Northern wheat out of Portland. Canadian wheat now sells at a discount of $15.00 tonne to Portland wheat. According to Sask Wheat Grain Companies are taking an extra $1.00 a bushel in basis from farmers checks.

Grain companies are not marketers they are margin traders and if they make a margin they sell.

The Canadian Wheat Board returned value to farmers and here are two examples..

In the 2010/2011 crop year, for example the CWB premium for 15.5 protein 2RS was $3.46 a bushel extra. This is $173 more per acre for the protein on a 50 bushel crop.

The Canadian Wheat Board returned value to farmers. In the 2007-2008 crop year my take home net price for the #2 RSW with 15.5% or higher protein was indeed $12.64 / bushel. It should be noted that the Canadian dollar was near par with the US dollar in this period. In Canada we have the the Harper dollar that is at 74 cents US right now.

Does anyone on here seriously think that these prices $12.64 a bushel for 2RS and protein premiums of $3,46 a bushel will ever be achieved again with four monopoly grain companies in charge of grain marketing?

Just take a minute and think about it. It's the exact opposite. The CWB only had a monopoly against farmers. They had absolute right to buy the grain from farmers in Canada. What makes you think they had any sort of monopoly on selling grain to the world? They had like 15% market share on wheat and only cwrs and no other wheat. they would even force cwrs into non cwrs markets. Please enlighten me how I have this wrong

was from the last thread. Thought I would repost since Chuck chuck, grassy and IF ignored it

[furrowtickler]

Macdon - that bush / Clinton pic says soooo much .

[malleefarmer]

interesting that since awb single desks demise a lot of the permiums have been debunked, kick backs paid, cut rate for freight as awb had own shipping charter lots of smoke and mirrors and in time a lot of ex awb guys are now working for private sector and revealing what went on. But strangley no one gives a stuff history no sour g****s move on type scenario.

But agree I think was farmaholic you guys were not ready for change.
And someone else mentioned costs of single desk hidden and other wise

[malleefarmer]

Grain companies are not marketers they are margin traders and if they make a margin they sell.

and farmer should do the same see a good price sell don't worry if its higher tomorrow if it fits your business sell.

standard practice here on any given day basis strong sell cash basis weak sell futures/swaps not rocket science if you don't like either stand aside

[grassfarmer]

Macdon - that bush / Clinton pic says soooo much .

You'll like this one too then - proving nothing's changed.

[Kinger]

Once of the single most fool hardy things a farmer can do is look at what he priced at in years prior. Every marketing year is different in futures, basis, protein, quality, etc. You need to sit down and figure out even roughly what your breakeven is and plan sales from there.

Yeah we probably are not going to get back up to $12/bu this year but if you know your breakeven and know what return you want be it $50, $75, or $100 per acre plan and make contract accordingly.

Oh and thinking that graincos are stealing an extra $1.00/bu is stupid, look how many of them are going through reorganization and restructuring. It ain't because they are rolling in cash.

[farming101]

I agree Kinger. If you don't watch where you're going it's not going to end well

[Guest]

I remember the CWB deductions being about $60/tonne on wheat on our cheques. I can honestly say I don't know or remember if we were getting all the "port" price less the cheque deductions. And then the odd time they said the government guarantee had to bail out the pools?

I guess some would say they are undoubtedly better off in the new system, moving as much as they want when they want (not totally true) and hopefully capturing the market peaks instead of having to take a pooled average. Before it was just shopping it around for the best grade, now its grade and price.

I don't think opening it up was the worst thing to do.....I just would have liked to see a smoother transition. ...not blow open the flood gates and let her go! Checks and balances.

agreed , or dual marketing would've been good too

[blackpowder]

Of course Mallee, without the burden of a particular history, makes the most sense on here.

[vvalk]

Just take a minute and think about it. It's the exact opposite. The CWB only had a monopoly against farmers. They had absolute right to buy the grain from farmers in Canada. What makes you think they had any sort of monopoly on selling grain to the world? They had like 15% market share on wheat and only cwrs and no other wheat. they would even force cwrs into non cwrs markets. Please enlighten me how I have this wrong

was from the last thread. Thought I would repost since Chuck chuck, grassy and IF ignored it

I guess no one has an answer to this.

[chuckChuck]

Walk did you forget about durum? In some years the CWB had over 50% of the worlds exportable durum which allowed them to extract significant premiums and manage the US market so that it wasn't flooded with Canadian imports.

If you are looking for a response to your questions there are several independent studies done on the CWB. Check out the KFT study Daryl Kraft, Hartley Furtan, and Ed Tyrchniewicz on the economic performance of the CWB.

Richard Gray at the U of S also looked at the impact on the loss of the CWB in 2014 2015 and the numbers were very large.

[wakopa]

tell me how you want the study to go and i will make it look that way.