Heads up on contracts.

[beaverdam]

I'd be surprised if there were many contracts for Aug delivery on a New Crop DDC(maybe it's just my geographical area, but contracts here would usually be Sept or Oct) so it seems early that companies would be dropping the hammer on farmers as it's only Aug 10th, still 20 days to fill an Aug delivery.

Still, what is stopping any farmer from finding wheat on their own from a better area, or from a non contracted producer, to fill their shortfall. Or have a broker find grain for them?

If this is simply about getting out of filling your contract that you willingly signed, and you knew there was no "Act of God" to protect your production from hail or drought, frost or pests,,, then I'm not on board.

Did you hedge your contracted volume with a futures position??? if you did, then you should have money to offset the cost to buy grain or to pay the penalty?

[jazz]

The grain cos are likely creating this squeeze on purpose. Forcing forward contracts in early and holding near futures down so the guys with potential uncontracted excess grain wont sell it right away.

Looks like a shake down to me.

[jamesb]

In my observation this fall in this discussion of the seemingly poor negotiation that exists for many. Its a real shame of the tact that is taking place by many. IMO the unwillingness to reach a agreement that will not create a bigger mess that what already exists with the drought itself. A deal is a deal and at some point this year or next the contract has to be honored. Over the years there has been a lot of contracts rolled to forward delivery periods (for a cost mind you). I expect that there is going to be irreparable harm to many long term relationships between grain co's and farmers from a unwillingness to reach a amicable arrangement. Forward contracting will be changed for a long time by most, especially those affected by penalties. I can envision the young CSR's of many of the elevators will find that until this situation becomes a distant memory will find a unwillingness by many farmers to forward contract without a AOG clause of some kind. Those AOG contracts are out there and will have interest by many. They are like an insurance product and will have a cost per tonne.

[GOODRUM]

what would the cash value of unfulfilled contracts be? Tally them up and bribe the media to report it, appeal to the bleeding hearts for sympathy is about the only way , pressure applied to grain cos through the media will get results , individual negotiations will be basically ignored.

[dmlfarmer]

what would the cash value of unfulfilled contracts be? Tally them up and bribe the media to report it, appeal to the bleeding hearts for sympathy is about the only way , pressure applied to grain cos through the media will get results , individual negotiations will be basically ignored.

Bad plan. The first question the media will ask is why did mr farmers sell something they did not have and with no guarantee of getting. Any one else doing that would be considered a scammer.. farmers will come out looking greedy, unreliable and poor managers. Many urbanites already have that opinion so why encourage media to amplify it.

Farmers should be talking up drought and the economic costs of it every chance they get but to focus attention on infilled contracts that farmers signed before knowing they would get a crop will backfire.

[GOODRUM]

Bad plan. The first question the media will ask is why did mr farmers sell something they did not have and with no guarantee of getting. Any one else doing that would be considered a scammer.. farmers will come out looking greedy, unreliable and poor managers. Many urbanites already have that opinion so why encourage media to amplify it.

Farmers should be talking up drought and the economic costs of it every chance they get but to focus attention on infilled contracts that farmers signed before knowing they would get a crop will backfire.

I disagree, there is an explanation why farmers sell something they haven't produced yet because the grain cos won't accept spot price or delivery, explain this and paint them like the greasy business partners they are.

[bucket]

I disagree, there is an explanation why farmers sell something they haven't produced yet because the grain cos won't accept spot price or delivery, explain this and paint them like the greasy business partners they are.

Just another reminder of how the tard Gerry and his minions couldn't get the market set up properly.

Spot delivery is an important piece for determining value.

To hear an elevator say you have to sign to get delivery or they are still working on April contracts in June is bullshit.

The worst is "how many inputs are you going to purchase here?""" to get to deliver.

For all you Gerry cheerleaders are you starting to realize he was a phucktard yet?

[tweety]

Can someone who helped the tard Gerry in his infinite wisdom of making an open market in canada without any grain exchanges explain how the contracts were not updated to reflect these kinds of things . Dealing with natural disasters or grade issues that are uncontrollable and have a defined cost at sign up.

Do the guys responsible for this have no shame? Or can now admit their shortcomings?

Graincos sell grain daily and have to meet specs , so how can they not have grade issues defined.

They also probably have a force majeure clause in their international contracts whether for weather delays , shipping issues or the fact the grain isn't available.


How does the farmer get left out of these same privileges????

They are completely controllable - don't sell something you don't have FFS.

[sumdumguy]

I have to say Ritz was half-hearted in his effort when he removed the tyrrant, oh maybe 1/4 hearted. The Liberals with Goodale had think tanks advising them, consisting of progressive farmers, seed plant owners, people who lived with and in the industry. I was involved in many of the sessions. Ritz, pfft, we don’t need input, we’s da boss! JMHO