CWB Fixed Price

[nw9flynn]

On Oct 17 the FPC was $5.48/bu on No.1 13.5, CWRS. $0.01 higher than the PRO.

Today, the FPC was $5.34/bu. A difference of $0.14/bu. Did anybody lock in the $5.48? My feeling is that anytime you can secure a PR0 price you should take it. Avoiding any risk of the PRO dropping lower.

Also, what does everybody feel the direction of the market is going to be for CWRS?
Charlie or Lee?

[melvill]

Better informed than I are saying that unless something dramatic changes in Argentine or Aussie crop conditions or some other unexpected factor, we are going to see U.S. wheat futures moving downward for the next while.

Today's (Oct 24) U.S. winter wheat seeding report says 86% is seeded with some dry areas.

U.S. exports are slowing down and usually do slow down from this point forward because other competitors, including Canada, are ramping up sales.

One major forecaster is suggesting a 25 cent/bushel drop between now and the end of the year.

[charliep]

Will leave price forecast alone for others discussion.

My only comment is to highlight the upcoming fixed price/basis contract this Monday (October 31). Anyone who is concerned about cashflow this spring should at least be signing basis contracts on wheat that is in the bin.

[melvill]

Yup, I agree with Charlie about thinking seriously about signing up some (or all) of their non-durum wheat on basis contracts. Basis levels are still very good. Fixed Prices for most types of wheat have dropped to a few dollars a tonne below the PRO. It's worse for soft white.

Of course, signing a basis contract means you're expecting a rally in U.S. wheat futures and/or a drop in the Canuck Buck or both.