Originally posted by blackpowder
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Only a single seller of the product can price differentiate to extract a greater portion of a
customer’s willingness to pay which was the case for wheat, durum and barley with the
operation of the CWB prior to the regulatory changes enacted in 2012. In that era, many
customers were paying premiums for Canadian wheat and durum relative to what they would
have had to pay for similar quality U.S. spring wheats and durums. That said, many customers
were not willing to pay premiums as the market for high quality spring wheat and durum is
limited. As a result, in order to clear the market, a significant volume of grain would be traded at values at a discount to U.S. values as that is what it took to sell the grain that was offered for
sale by farmers to the CWB at the time.
Authour: Ward Weisensel for SK Wheat in 2020
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