Ethanol

[Vader]

Charlie, I think that in the absence of a driveway test for DNA we will be forced to move to a declaration/contract system for milling wheat and abandon the KVD system. Potentially all milling wheats going to IP systems such as the warburton contract or navigator durum.

On the DPC, I am nervous about the same issues you raise. If I were to enter into a DPC it would be a small lot, say 20 tonnes. Only time will tell whether this system will fly or not. Transparency is a problem. Can the CWB announce exactly which elevators are being canvassed for the average pricing and maintain the integrity of the program?

[Incognito]

no need to defend ADM.

you showed your ignorance long before i entered this thread...and you have again by your posts above this one.

[silverback]

Those are my choices hey?

Either the mother company takes my good grain for the good of the collective, or I take it to a feedlot.

Thank you, thank you, thank you. You are too kind. I love this country.

[Incognito]

While the majority of sales are direct, where the CWB negotiates directly with the buyer, there are also sales that are made using a CWB Accredited Exporter. Accredited Exporters (AE's) are national and multinational companies authorized to purchase grain from the CWB for resale to customers and other exporters. Many AE's are tied into extensive sales networks and markets that compliment the CWB's sales efforts. With branch offices scattered around the globe, these companies can make direct contact with customers in markets the CWB staff would have to travel to, thereby helping to reduce unnecessary expense. AE's also facilitate sales through freight sharing and acceptance of financial risk. In some cases, holds on ship can be shared between Board and non-Board commodities. In addition, some buyers may present financial risks not acceptable to the CWB. AE's provide a valuable service by assuming this financial risk.
http://www.cwb.ca/db/buying/sales_process/accredit.nsf/accexppage?OpenForm

According to CWB officials, accredited exporters handle 20 to 25 percent of export sales. In addition, accredited exporters are used on 100 percent of the sales to the United States.

http://www.gao.gov/archive/1996/ns96094.pdf

Direct comparisons of export prices were limited due non-responsiveness and due to the unavailability of prices. Some countries only bought from either Canada or the U.S. so prices were available from only one of the exporters. Others received exports directly through the CWB where no price data was supplied. Direct comparisons were made for the Venezuelan market (a market served by accredited exporters).
(Section 301 Analysis of Effects of CWB on U.S. HRS/HAD)
http://www.farmfoundation.org/flags/wilson.pdf

Auditor General's report:
"...[We have noted] significant deficiencies in governance, strategic planning, performance measurement and reporting, and the management of information technology..." "...deficiencies in performance measurement were identified in the marketing areas of sales plans, sales negotiations, performance of Accredited Exporters, and market development..."

Currently, CWB-accredited exporters have a significant role in marketing CWB grains. These exporters would probably take up market development activities for open market wheat and barley.
http://www.choicematters.gov.ab.ca/files/pdf/Test_open_proposal.pdf

Customs staff at the ports of Pembina, North Dakota, and Duluth, Minnesota, reviewed recent entries of wheat made under several large contracts between the CWB-accredited exporters and buyers in the United States. By comparing the entered values to information contained on invoices and contracts, the staff determined that for all the entries they reviewed, the entered value was based on the prices used in the transaction between the CWB's accredited exporter and the purchaser in the United States.

http://www.usembassycanada.gov/content/textonly.asp?section=can_usa&document=nafta_wheat_ appendix&subsection1=trade&subsection2=nafta

The CWB does not deal directly with many buyers of barley. Instead, it appoints members of the private trade as accredited exporters to negotiate sales. For example, sales of malting barley to the U.S. and feed barley sales to Saudi Arabia are handled this way. In fact, most of the world barley trade is conducted by private grain companies.

http://aic.ucdavis.edu/oa/stecwb.pdf

"At the current time, we are not in any discussion with Iraq," CWB spokeswoman Louise Waldman said. "We are in a severe drought situation. Our projections for our crop are that it will be decreased by one-third, which will make just meeting our existing (export) sales difficult." She added, "There are licensed wheat exporters in Canada accredited by the CWB, and I have no way of knowing if any of them are in talks with Iraq." http://wardsauto.com/ar/agriculture_canada_wheat_board/

"We have checked with our accredited exporters to see if the shipload of Canadian milling wheat had been sourced in Western Canada....it was not," Rheal Cenerini, media relations officer with the Canadian Wheat Board (CWB) said. "All the wheat that has originated in Western Canada has so far been well received by our Ukrainian customers." http://www.hpj.com/dtnnewstable.cfm?type=story&sid=10334

[parsley]

Vader,

You state:

We should be contracting for the best grain.."

How do you define "best grain"?
Is it the CWB's place to set the bar for 'best', or should the buyer determine what is of most value to him?

Inportant basics, Vader.

My experience has been is that my highest priced grain would probably be classed as feed by the CWB. But buyers are willing to pay. And pay well for grain the CWB doen't even know they want.

You state:

"We need a better system to reliably provide our top quality grain to our top paying customers "

The CWB's so-called TOP paying customers aren't even on the radar screen for some of the top-priced wheat and barley actually being marketed.

How can the CWB pay top prices when they don't even know what the market really pays premiums for, Vader?

Parsley

[Vader]

Parsley, you are absolutely right. The buyer determines what is "best". In fact in a IP progam there must be a buyer willing to pay the costs of such an IP system, otherwise it doesn't make economic sense.

[parsley]

There is a problem here with who is a buyer and who is a seller. And what is crap.

In Eastern Canada, the farmer is the seller and there are unlimited export buyers. I am talking about this kind of buyer. One who pays what the seller is willing to sell to him for. The farmer knows value. He feeds his family on it on it, Vader.

In Western Canada, the farmer is the seller and the CWB is the sole buyer for the export market.

The CWB buyer takes ownership of the grain and legally owns it and sends the farmer a partial/cheque for it.

My point is I don't think the CWB even knows which grain is valuable. I don't think the CWB knows or understands what the marketplace wants, either.

The main value of the role of the CWB is to protect CWB jobs by dumping the grain, but that doesn't help me, the farmer.

Is it maybe a little easier to dump top quality grain Vader, and look good at the Minister's Barb-b-que, and a little more difficult to dump "crap", as you succinctly describe it? Quick and slick?

My point was the CWB doesn't even know what value can actually be. "Crap" can be valuable, Vader, and good marketers know that.

Parsley

[silverback]

Well put Parsley.

[Vader]

I borrowed the terminology "crap" from silverback as he suggested that was what he might have to sell.

The confusion about who is the buyer and who is the seller is an important point. Parsley argues that the CWB is the buyer and that is normally the position of those who I would term "detractors". Those who believe that the CWB represents their best interests are more inclined to view the CWB as selling their grain for them.

So the question as to whether the CWB is a buyer of your grain or a seller of your grain is not so much a legal issue (as Parsley would want to define it to support her position) as it is a philosophical issue based on whether you believe in famers exercising market power through single desk selling.

[charliep]

I have to put on my Alberta Market Choice hat. If if is philosophy and not law, why is the CWB act necessary? Why have farmers gone to jail?

I also note that accredited exporters do most of the business on behalf the CWB. Most grain is sold FOB Canadian port (loaded vessel) unless things have changed. The accredited exporters providing additional services (ie. ocean frieght). There is a complicated relationship between accredited exporters, end user buyers and the CWB but that is the subject of another thread. When the smoke clears, business/pricing is done on a competitive basis with wheat supplies available from other exporters.

I also note the multi national you mention is a member of the Canadian National Millers Association and if I remember correctly they are supporters of the CWB. I assume they support the CWB in this matter because it suits their business interests. You can correct me.

[parsley]

Let's take a closer look, Vader.

For those farmers who have to sell their grain to the CWB, and then buy it back again, ownership is an important issue.

You understand full well, Vader that the CWB is a buyer of grain. A buyer. (Why else would I have to buy my grain BACK from the Board if they did not have legal ownership?)

And being the buyer of all Western wheat and barley for export, they have a youknowwhatkindofload of grain they own.

1. The CWB can eat it.

2. The CWB can burn it (In fact that is what they told Manitoba farmers to do with fusarium wheat a few years ago because the CWB didn't want to market "crap" like that, Vader, even though it was very valuable in the USA if the Manitoba farmers had been allowed to market their own grain.

3, The CWB can peddle it at firesale prices.

And if you bloody don't believe #3, would someone please post last years price of CWB wheat and barley (WHAT THE FARMER PUT IN HIS POCKET) on this site. Show me the money, Vader.

Your words have no credibility Vader. What the CWB says it gets for farmers and what the farmers actually get in their pocket at the end of the year are entirely different figures.

I know crap when I hear it Vader.

Guys like Silverback ask really important questions like, "Why do I have to pool my grain with yours?"

If you gave Silverback the true answer, Vader, it would be this:

"You have to pool the grain, because then CWB employees and CWB hacks are guaranteed a job"

Parsley