WCWGA press release

[TOM4CWB]

Vader;

I am simply amazed at the "single desk" comments.

Farmers across western Canada have been cross blended for years on grade... and do you know of any grain companies getting rich on upgrading?

NOT.

It is all about volume... handle...

If a #1CWRS is a scarce grade that the CWB needs... the spread between a #1 and #2 should be $25/t, not $8/t.

Pure and simple, the CWB has caused this problem 100% by themselves, and got exactly what they asked for!

A low quality #2CWRS to the maximum quanity of the grade... my farm included!

Would you truly expect anything else?

[Vader]

The spread between #1 and #2 is definately contributing to the problem. The CWB has difficulty changing that spread when necessary because of the requirement to go to the Federal government for permission to change the initals.

Part of the solution to this problem is for the CWB to take over the management of the initial and adjustment payments. This is being forced upon us through the WTO process and the eventual removal of the government guarantees.

I would ask how are these risks to be managed without the government guarantees and to what extent should Western Canadian Agricultural producers be compensated for this loss.

A standard 80% EPO on everything would pretty much solve the problem but should farmers be stuck with that cost? Or should the Government help set up a large enough contingency fund to backstop the risk management program?

Another important aspect of the government guarantees is the cost of financing the purchase of the crop. When the CWB or any grain company purchases grain from a producer the ultimate consumer of that grain has not yet paid for it. So whether it be the CWB or a grain company somebody has to borrow some money in order to pay the farmer for the inital purchase price. So there is a cost of borrowing built into the transaction. At this point in time the purchase of the wheat crop in Western Canada is financed by the CWB and it is done at the same credit rating as the Federal government. When the CWB loses the government guarantees that credit rating will be eroded and the finance cost will go up. Farmers will bear this increased cost. This is another quantifiable loss that we will be burdened with as a result of the governement bargaining away the guarantees in the WTO process.

Will farmers in Western Canada understand the potential costs of losing the governement guarantees and voice their concerns loudly enough so that adequate compensation is made?

[mcfarms]

Tom
I read your comments about blending not making the line companies money, why do they do it then? Of course it's always been a good source of revenue for them and may be one of the biggest inpediments to implementing an on farm stored system, however even this is no reason not to continue to stive and find ways to use this system we have for the time being to gain better returns for producers. And yes Vader I was a little bothered to say the least when the spread between 1 and 2 cwrs didn't move a little wider to preserve all the 1, though I believe from conversations with terminals that the 1 is for the most part being held seperately and not blended down.

[Incognito]

Companies buy as high as they can and ship as low as they can. Period. If you don't - you are soon road kill. But in doing so, the quality of our grain is going backwards.

They are segregating 1 CWRS and keeping it segregated because they expect tenders to go for plus 8 to plus 10 dollars over for 1 CWRS.

They are plus 4 to plus 6 already. So rather than give the incentive to the farmer, the companies are getting it. If you have 1 CWRS don't settle for your normal $4.50 trucking premium. Think $9.00 to $10.00.

Fair and equitable only works in unions - no wait, it doesnt work there either. Farmers with 1CWRS 13.5 should be livid. Farmers with Canada Feed should be sending thank you cards to the 1 CWRS areas.

And while I am venting, whats with 4 CWRS...? Initial is the same at $84.00 for 4 CWRS and CWFW. Pro's have a $12.00 spread. So much CF has been bought as 4 CWRS the integrity of the pool is threatened.

Why the blind eye, Vader?

[Incognito]

Re: Farmers understand the effectiveness of the Gov. guarantee?

What do you think? Farmers and industry argued about the Crow/WGTA until it went from 13 billion to 7 billion to 1 billion.

Farmers argued about the CWB until the WTO will make the changes for Canada.

In order to go forward, you must learn from the past. We havent.

[TOM4CWB]

Vader,

Talking about grade spreads:

The PRO on 1 CW Feed Barley (50lb/bu and more) is now $111/t.

But the initial is down $10/t instead of $6/t. What gives?

If the feds can put together a price for the "B" Pool on barley, in time, I don't buy the argument that the CWB couldn't have changed the spread... it had since Aug. 20th to fix the spread... and still hasn't done it.

This is about PPO's isn't it Vader!

Wash them through... get all the 1CWRS in, then the spread goes to pool holders instead of PPO flat priced contracts.

The initial spread is the basis spread for PPO's!

Simple.

The CWB is soooo cunning!

In other words DO NOT fill PPO's until the spread is changed!

Little late now... after the horse is out the open barn door!

[Incognito]

I admire your passion Tom; however, some days you need to take a pill...lol

Best,