CWB and Milling Wheat to Japan

[TOM4CWB]

Charlie;

I see these reported sales to Japan:

US sales of HRS/SW/HRW:Japan 85,000 mt 06/01-06/30

Japan also purchased 25,000 mt of Canadian wheat and 40,000 mt of Australian wheat for delivery 05/01-06/30.

The CWB covets sales to Japan... yet Canada looks to be a residual supplier.

Are we loosing market share of the milling wheat market in Japan?

[TOM4CWB]

Charlie;

According to the USDA, the sale was 1 Canadian Western Red Spring 8,000mt and Western Amber Durum 17,000mt... which is even more disappointing for CWRS sales.

[charliep]

Just a note you can't look at 1 weeks sales with Japanese sales. CWB has a sales agreement whereby they provide about 120,000 tonnes a month. What the weekly tenders outline is the amount they priced that week versus amount that is sold.

There are issues this year in supplying product because of quality. To the end of January (6 months into the crop year), exports to Japan amounted to 472,000 tonnes, down from 555,000 tonnes in the previous crop year.

As a note, Japan buys about 5.4 to 5.5 MMT of wheat each year, down from over 6 MMT 10 years ago (same reason as North America - trend to low carb diets).

The US share of the market is 55 to 60 % with the recent share on the 60 % side. Canada's share has varied from 23 to 27 % but the last two years has slipped to more around 21 %. Australia has been in the 18 to 20 % market share with recent numbers closer to 21 %. Canada is loosing market share.

In volume terms, Canada has normally shipped 1.4 to 1.6 MMT to Japan but has recent slipped to the 1.1 to 1.2 MMT area (where we are likely to be this year).

[charliep]

Maybe I have to turn the question around. Supply is an issue. Why doesn't the CWB identify Japanese quality 1/2 CWRS high protein wheat in the farmers bin, contract it so it is committed/available when needed and pay these farmers interest/storage the way they do with malt barley?

[parsley]

Incognito,

I think you are referring to Flaman's brainwave...the "brand new" organic option.

New? previously, we sold to the Board. And then bought back from the Board Nothing has changed. Sameold.


Previously, organic producers paid an admin fee for going through the buyback. (A special fee paid to the Board so you can sell to the Board. Hmm.) Nothing changed, guys. Sameold

Now they say you don't have to pool, anymore What does that mean?

It means: the difference between the money the Organic producer sells to the Board for, and buys back from the Board, will not go to farmers pooling accounts anymore. the difference will now go to a CWB Admin fund (slush fund)

Won't the Liberal party of Canada love that? Flaman will be able to attend all those Liberal fundraisers he indicated he wanted to attend, but that previously, senior Directors got to attend, and all on the farmers' dollar.

The announcement is bad for organic farmers but it is promising for the CWB staff and Diretors.

Parsley

[rosco]

Charlie, I think in an earlier thread you mentioned canadian farmers having an IP advantage to the states because we all store our grain in small amounts on the farm till we can deliver. This is true and also holds true for grade, but on a year like this one past, many farmers are blending good with poor on the farm to try and put a few more cents in their pockets, and we are really shrinking the amounts of high grade grain to send to the premium markets. On that note, why isn't there more of a premium for 1 and 2, which might discourage guys from farm blending and just do paper blending at the terminal, so we can better fill these tenders into the lucrative markets?

[charliep]

rosco

One of those times I admit to not having an answer to your question.

The logical answer would be to have a good knowledge of what is in farmers bins and move it forward as needed. There would be losers and winners in this process. The issues that pull the system down are lack of trust (mainly at the farm level) and most elements of the industry/regulatory agencies not wanting to be accountable. The other logic from the grain supply chain would vary from philosophy around evil greedy elevators who want to bend to make money on the one side of the spectrum to grain companies who would argue there is not enough margin/too much risk to justify close to identity preserved programs.

What are others thoughts?