Sask Wheat Commission Report Excessive Basis aka Grain Companies Screwing Farmers

[bucket]

Sawfly

If they become saturated with facilities they will close them without even an inquiry by any government as to why...

The Eyebrow elevator is a perfect example...10000 tonne concrete ....closed because Viterra wanted better logistics instead of spending a few dollars to expand the location....move the highway since they were rebuilding it anyway and have a straight line loading of 110 cars like they do up at viterra's GDT location...

Nope grain gets trucked to their other locations right beside a railway in both directions....

[jamesb]

Being fairly close to the US border we have always compared our prices to those south of us in North Dakota. In the old CWB days it was a constant irritant to see the higher prices south of the border at different times of the year with a very difficult time make it work with the buyback etc. Post CWB have seen the price differences exist only more rarely. Doing the math today I probably am paying net .30 per bushel higher in basis in Sask than a ND elevator. Havent figured out if there is any missing deductions on the US side without them grading the sample. Some guys got caught a few years ago after having good luck selling grain they had in bins and then the next year doing a forward contract to find out the deductions made their wheat less than if they had marketed local. Bottom line for me that if the basis gets too wide in Canada compared to the northern US places like CERES will start buying a lot more and shipping it into US or Mexico markets. This seems to happen every now and then.

[chuckChuck]

Take a look at Montana Elevator Cash Grain Prices

https://www.ams.usda.gov/mnreports/bl_gr110.txt https://www.ams.usda.gov/mnreports/bl_gr110.txt

[Bowerpower]

Being fairly close to the US border we have always compared our prices to those south of us in North Dakota. In the old CWB days it was a constant irritant to see the higher prices south of the border at different times of the year with a very difficult time make it work with the buyback etc. Post CWB have seen the price differences exist only more rarely. Doing the math today I probably am paying net .30 per bushel higher in basis in Sask than a ND elevator. Havent figured out if there is any missing deductions on the US side without them grading the sample. Some guys got caught a few years ago after having good luck selling grain they had in bins and then the next year doing a forward contract to find out the deductions made their wheat less than if they had marketed local. Bottom line for me that if the basis gets too wide in Canada compared to the northern US places like CERES will start buying a lot more and shipping it into US or Mexico markets. This seems to happen every now and then.

Feb March 2008 I believe it was $20 us down south and our beloved wheat board was giving us 7 dollars. Had 50,000 bushels wheat in the bin. As a young guy starting out could have almost paid off my first land purchase with that difference. Never ever wheat board. F that

[Agvocate]

There have been several calls on Agriville for more transparency in the grain marketing system.

Farmers need to know what the basis looks like over the whole marketing year or several years to determine if the basis is a true reflection of the cost and risk of moving grain from farm to customer.

Or do grain companies often take excess profits in an uncompetitive system?

It seems that many producers on Agriville are suggesting the latter.

Now lets see the numbers so all parts of the grain system can see what going on.

Transparency on sales and values in Canada has never been what it is in the US. Agree that it would be nice to see more, and in a more timely fashion. As far as this chart goes, not sure how much to read into it. For one the flat price sales values are for similar types of wheat sold out of the PNW and then assuming those values are repeated in Vancouver. There is also no time associated to when the sales snap shot in the US was taken vs the country price in Sask was taken. I will assume relatively close but its not apples to apples. I think if you could find an accurate port of Vancouver basis level, through a marketing source you can piece together what it "should" cost to get from SK to loaded vessel. $45 rail freight, $10 to put it through the in land elevator and $20 or so port costs or $75/MT just over $2.00/bu. Any spread past that is margin.

[walterm]

Transparency on sales and values in Canada has never been what it is in the US. Agree that it would be nice to see more, and in a more timely fashion. As far as this chart goes, not sure how much to read into it. For one the flat price sales values are for similar types of wheat sold out of the PNW and then assuming those values are repeated in Vancouver. There is also no time associated to when the sales snap shot in the US was taken vs the country price in Sask was taken. I will assume relatively close but its not apples to apples. I think if you could find an accurate port of Vancouver basis level, through a marketing source you can piece together what it "should" cost to get from SK to loaded vessel. $45 rail freight, $10 to put it through the in land elevator and $20 or so port costs or $75/MT just over $2.00/bu. Any spread past that is margin.

Farmers never did get info on individual sales but did get annual year end audited reports. Farmers asked for more transparency not less.

[Agvocate]

Farmers never did get info on individual sales but did get annual year end audited reports. Farmers asked for more transparency not less.

Yes, I was comparing what we see for sales vs. what the USDA spits out if there are sales made over a tonnage threshold. Doesn't give you a value but it gives tonnage, destination and marketing year. Canada gets CGC stats 2 months after they are completed loading. Thee breakdown and spreadsheet is actually pretty good, it just isn't timely.

[farming101]

Transparency on sales and values in Canada has never been what it is in the US. Agree that it would be nice to see more, and in a more timely fashion. As far as this chart goes, not sure how much to read into it. For one the flat price sales values are for similar types of wheat sold out of the PNW and then assuming those values are repeated in Vancouver. There is also no time associated to when the sales snap shot in the US was taken vs the country price in Sask was taken. I will assume relatively close but its not apples to apples. I think if you could find an accurate port of Vancouver basis level, through a marketing source you can piece together what it "should" cost to get from SK to loaded vessel. $45 rail freight, $10 to put it through the in land elevator and $20 or so port costs or $75/MT just over $2.00/bu. Any spread past that is margin.

Ten bucks for elevation? Haven't seen that for years