Useless Canadian Grain companies

[farmaholic]

Or the insane risk we face every year

Ah ****....what's a bit more risk for us to help ease theirs?....Just sell it and take a position....don't worry about the futures or option and rolling costs! It's the least we could do...

[Blaithin]

Blaithin, maybe Producer's are paying for the "Sellers" inability(penalty) to fulfill THEIR contract specs with their buyers?

I think that can be a fairly accurate assumption.

I don't know if I would call it a penalty. Farmers sell contracts based on what they think/hope they might harvest, Grain co's do the same. Try and take advantage of the futures market and it doesn't always work out. This year, the protien is kicking everyone in the ass.

It needs to be remembered that Grain Co's are the middle men. They have just as much potential of being stuck with a commodity that they can't make a profit on or sell if they aren't careful. So they're very careful. They're lucky in the fact they have farmers as a buffer against Mother Nature and the risks she carries. Does that mean they're screwing over the farmer because they won't buy the product the farmer has, despite it's specs not being anything they could sell? They wouldn't be in business very long if they plugged up all their terminals with off spec grains they don't have sales for, just because that's what was around in their area. Right now they have sales for higher protien and the majority harvested is looking to be lower protien. They don't need low protien, so aren't offering to pay anything for it; They do need high protien and that's in smaller quanities, so the premiums for it are high. It can be sickening, the gaps between the protiens especially, but it does make sense from the supply and demand perspective.

Does anyone here have 15.0+ px and feel like they're being hosed by Grain Co's? Or is it just the people that don't have the protien that feel they're getting shafted.

[blackpowder]

Or just sell it in June for Sept delivery at >$8 like this year.

[seabass]

I think we did have coops. They were called the wheat pools. We gave them away for free. Hoodwinked!

[farmaholic]

Aaaahhhhh yes.....the perils of selling something you may not have or be able to get! Producing something in an environment that doesn't provide consistent predictable results.......we aren't manufacturing widgets in a factory. My God!

.....and there's enough grading specs and tolerances that need to be met that there's always "something wrong". Quite the arsenal of ammunition to beat something down with....

[GDR]

Most of you guys seem to miss the whole point of free market that you have asked for. Name of the game is make as many dollars as you can. Same applies to grain companies input dealers machinery dealers and of course farmers. Don't know how any self employed business people can argue with that. Asside from collusion or price fixing good for the grain cos to make a buck.

I personally like the marketing end of things, don't always do it right but can be quite the rush sometimes.

[blackpowder]

With the current price likely you could buy someone elses to fill or get out of contract. Honestly, no one sold any wheat at $9?? You dont know by July 4 you wont get half a crop? Okay, your in the Special Areas and may get 10 bushels. Sell some paper. I know its not that simple ordinarily but $8-$9???
No one should have too much unsold wheat this year. We need to stop blaming someone else.

The post was started about px spreads etc. Tricky one that screwjob is I agree. Knowing for sure your gonna get good px impossible. I dunno, seems wheat getting simpler actually. Mid grades/classes and bushels. I notice the new terminal built close by has 2 wheat bins with a few small blending bins. Pounding out southbound trains.

[farmaholic]

As I mentioned much earlier in this thread BP....I was expecting our Px levels to be in the stratosphere. ....13.1 to 13.7 is where we're at, I was expecting 15 plus plus plus.

I remember selling wheat with Px levels almost a full point above 15.5 and only being paid for about 15%

Or "#3" durum way above the highest point they pay at...13% px. That was even a CWB issue >:-( talk about giving away value.

Edit: funny, when I buy an auto or piece of machinery with an option installed I don't want I still have to pay for it!

[Kinger]

Ok then.... every farmer just blow out your grain and hope the prices go up.... Come on Kinger...

Haul your grain early but get to stay in the market top hopefully maximize profit.

Say you sell some grain you had and attatched a call to it.

Your worst case scenario is you lose the value of the call option from your contracted price. But it lets you stay in the market and participate if the market goes up while minimizing the risk of the price going down by already selling your grain.

Or hey if you think the market will go down use a put. You have options.

Sitting with grain can work as you can get upside on both futures and basis but at the same time you are open to downside risk on both.

Every situation is different, and I wouldn't recommend selling every bushel you had and attaching calls.

But if the tool fits use it. Pretty sure Shakespeare said that. Or Steve Carrell. 50/50 either way

If your comfortable with them that is ok too, it's a risk many aren't willing to take. But I would recommend learning more regarding them.

[SASKFARMER3]

A few I know have been shopping same samples around province and yea their are a difference of over a full point in same sample. Two places were the same. Highest by USA border

[Les Magura]

I guess the Wheat wasn't so bad after all, pity Harper sold it to American and Saudi interests for pennies on the dollar for a last minute fudge it budget in attempt to cling to power. This including a lot of assets that farmers paid for over the years including the rail cars that the railways now put on the back burner because its more lucrative to move oil and gas. It also include grain elevators large port facilities and freighters as well believe. Would be surprised to see Harper sitting on some of these boards, collecting as healthy fee, soon given the expensive gifts he gave away.

[blackpowder]

Glad to see nobody is taking that knuckleheads' pro _ _ _ bait.