CWB

[parsley]

carebear300,

This is an easy concept, but you should pay close attention to what incognito says about playing the game, and why the terminals are working against farmers when you read this:

http://www.world-grain.com/articlearchives/archive_article.asp?ArticleID=67446
World Grain, October 1, 2003


CANADA — ARCTIC SEAPORT GETS GOVERNMENT FUNDING

The Port of Churchill and the Hudson Bay Railway has received a C$2.2 million (approximately U.S.$1.5 million) boost from the Canadian federal government and the Province of Manitoba for infrastructure improvement and marketing.

The Western Grain Elevator Association and the Inland Terminal Association of Canada have strongly objected to the funding, which they say distorts an otherwise competitive market.

The Port of Churchill Advisory Board in April warned the port might be forced to close unless more shipments of grain and other commodities were sent through the northern gateway. The Port of Churchill exported 279,000 tonnes of agricultural product in 2002, compared with 478,000 tonnes in 2001 and 711,000 tonnes in 2000


Good for Manitoba, right?
Good for farmers to have another port, right?

An "otherwise competitive market"? who really wants the status quo? So who's interests are the Inland Terminal Association protecting?

Parsley

[parsley]

wmoebis

I said, "organic farmers bypassing the CWB".

In other words, organic farmers would get their CWB export licenses (the same as Ontario now enjoys, the same as all seedgrowers now enjoy), no buyback, identity preserved, and ship directly to the buyer. Nothing to do at all with grading or pooling or donating to the Liberal party.

You can't seem to think outside the Wheat Board box, wmoebis!

Just think of the Board as a licensing agency, handing out licenses to every organic grower who applies for one, not costing anything, yet compliant with the CWB Act. That is what Quebec enjoys, too. Got it?

Parsley

[wmoebis]

Parsley

I asked simple questions to help me and others understand how a simple dual marketing system would work.

Thank you for the reply.

[parsley]

wmoebis

The CWB could issue export licenses to every farmer living in the municipalities around Stettler if they wanted.

Those farmers would then bypass CWB marketing, pooling and all the organized systems. Sell direct. No buybacks.

The CWB did allow the farmers from Creston -Wyndell to do just that.

They were very unhappy with the CWB as they could go right across the border and get good prices, SO the CWB just took them right out of the CWB's Designated Area with one Board motion.
Aren't they lucky? And they sure aren't begging to get back in.

Parsley

[chaffmeister]

wmoebis:

If you are looking ahead to a “dual-market” and wondering how to keep CWB and non-CWB grain separate in the system, I would ask why you would want to.

Back in the old days when western feed grains were being shipped to Eastern Canada through Thunder Bay, so were CWB feed grains. And yes, they were commingled – CWB 1 Fd barley with non-CWB 1 Fd barley. CWB feed wheat with non-CWB feed wheat. It works because who owns what (CWB vs non-CWB) is well documented as the grain moves through the system.

So, the answer to your other question is yes – non-CWB milling wheat would be sold under Canadian grade names and grades.

[agstar77]

They would make a deal with a mill in South Korea and ship them a container of wheat. I'm sure they would be willing to pay the extra cost of a container. Or wait maybe you could get a bunch of farmers together and and fill a vessel . Oh that does sound like pooling, can't have that! Of course you could get producer cars? Maybe everyone could just line up at the border and sell into the U.S. They would welcome you with open arms now that the CWB is gone. There would be no more trade challenges , because after all you are true free traders and they would respect you. Yes this will be a true utopia when that nasty CWB gets out of your way. There will be huge flour mills and pasta plants springing up all over built by entreprenurial farmers like yourself.

[wmoebis]

I guess what I can't understand is say I sell 100 tonnes of #2 12.5 cleaned to export standards (which is my what customer in say Billings MT. wants)So I get three super B's in. we load for shipment. Who and where is that going to be gauranteed from? Because if I don't ship what was agreed to that customer is soon going to loose faith in all customers in Canada. One bad apple like me could ruin it for everyone.

Each of us could get our own little niche market but that isn't going to carry us all. We will have to ship through CWB and/or line companies. If we start mixing non board and board grain to the same destination at different prices and possably different qualities I see wreck happening.

Ps: Take a deep breath, I'm not standing up for CWB or calling it down. Just trying to look through possable senerios. Wanting to see what a dual marketing system would look like in ten years when the world price of grain turns around and we really have some thing to worry about.

[chaffmeister]

Number one of a series:

Sawfly – a number of responses to your comments.

You say “…but to give in to a minoraty that figure it is benificial to have thousands of sellers of western cdn. wheat rather than one is sad.”

Assuming you are right about the number of farmers that share your views about the CWB, what is really sad is that this majority of farmers truly believe that the “one seller” is getting better prices than you each would get on your own. Remember – THE CWB DOES NOT HAVE A MONOPOLY; it simply represents all wheat exports from Western Canada in a highly competitive global market. Within Canada, the CWB sells at market prices. Markets characterized by a multitude of sellers and a multitude of buyers are widely recognized as the most efficient market structures known. Efficient for both buyer and seller. It saddens me that the CWB can maintain this propaganda about farmers destroying the price by clambering over each other to sell into a hole.

Also, you say “just ask monsanto what happens when a seller jions your market, that isnt under your control. Going to 2 sellers cut the price of glyphosate in half. if there are any preiums out there they will soon dissapear with multiple sellers.”

Please don’t try to misdirect. Monsanto had a patent on glyphosate. It ran its course. Monsanto could not stop others from producing and selling it or similar products. The only reason that Monsanto could charge as much as it did was because IT HAD A PATENT. IT HAD A MONOPOLY. This is a poor comparison to the CWB. Remember – THE CWB DOES NOT HAVE A MONOPOLY. The CWB’s single desk does not have the power to extract premiums like it says it does. Their own customers have said so. What is sad is that so many choose to continue to believe the CWB, even in the face of widespread dissention and evidence to the contrary. Even if you don’t want to believe others, shouldn’t you at least question the CWB???

Another: You say “the board has elvoled a lot ,(for the better) hedgeing, fixed price, daily price, basis contract, and could change more”

If the CWB contracts are an improvement, why is the uptake so poor? I suggest these contracts do not provide value, they are complicated and one sided. I think for the CWB to be “better”, farmers need to feel the benefit. If only a very few are using these contracts (and even fewer are benefiting from them) then the CWB has not improved – it has not evolved for the better.

One last one:
You say “Its fine for the open market to steal our canola this last year...” Let’s open this one up for discussion. Are you saying the open market failed you? How so?

[chaffmeister]

Number two in a series.

Agstar77 – Your response to parsley shows a misunderstanding of how things really work.

(1) Believe it or not, wheat has been exported by container – probably enough to surprise you. Buyers are getting very particular about specs – not grades. Warburtons goes to the extra trouble and expense to “select” wheat by grower. General Mills in the US buys by postal code – they pay premiums for wheat from very small areas because they’ve gone to the trouble of determining the characteristics from each area and buy directly on that basis. Your world truly is changing. I’m not so sure of the CWB.

(2) Get a bunch of farmers to fill a vessel?! Come on, isn’t that a little sophomoric? Or have you simply chosen to not understand how things work?

(3) “Line up at the border and sell into the US”. Now isn’t that a visual! The thing that those that fear an open market don’t understand is that grain will only move when and where it needs to. When price is allowed to play a role, arbitrage kicks in. What this means is that Western Canadian wheat prices will feel the effect of US prices to the point that wheat will not flow into the US like water going downhill. The other markets (offshore and domestic) will simply compete for the wheat – on price. (This of course is contrary to the argument that thousands of farmers trying to sell wheat will push the price down.)

(4) On trade challenges – you should note that ALL the trade challenges we’ve seen on wheat have really been about the CWB. Interestingly, the largest importer of oats in the world is the USA – buying from both Canada and Europe (Finland and Sweden). And not a peep out of the US oat grower. I wonder why? I’m not about to suggest that I can second guess the American wheat farm organizations and how they would respond to a totally open market in Canada, but it is clear that without the CWB and without Canadian subsidies, they’d have a tough time pushing another challenge forward. And besides – the flow of wheat down to the US won’t be a huge as the fear-mongers want us to believe.

[chaffmeister]

Number three of a series:

wmoebis:

I’m having a hard time putting your example together. You sell 100 tonnes, you line up the trucks and you load them. But then you ask “Who and where is that going to be guaranteed from?” You could get SGS or even the CGC to provide third party verification. But ultimately you are the one that will guarantee it. And if you screw it up, you won’t screw it up for everyone else – just yourself. Your buyer in Montana, while dealing with you as a problem supplier (likely for the last time before he cuts you off all together), would be happily developing good relationships with others (perhaps even a voluntary CWB).

You are still concerned about “mixing non board and board grain to the same destination at different prices and possibly different qualities”. First – you wouldn’t mix different qualities – not if you want to stay in business. If the CWB is selling to the same customer as you are, big deal. So the buyer has bought some from you, some from the CWB, some from others – if he doesn’t have a problem with it, why would you? And of course there would be different prices – there are different prices each day. Buyers are used to that.

Believe it or not, I’m in the same camp as you. Like you, I’m not “standing up for CWB or calling it down” – although I see a lot that needs improving, changing or simply ending. I really don’t care whether the CWB is there or not. I just get real tired of the debate when it is based on half-truths, mis-directions and flat out lies.

[parsley]

I'll be on your bad list chaff, because I posted "half-truths, mis-directions and flat out lies" last night.

Creston-Wyndell farmers bypass the CWB but are still in the Designated area. The CWB didn't remove them.

I wrote, " the CWB just took them right out of the CWB's Designated Area with one Board motion." Oh Oh

That is NOT TRUE!

Creston Wyndell is STILL in the Designated Area, BUT they are simply ISSUED EXPORT PERMITS by the CWB.

No buybacks. No pooling. No Board marketing. They sell/export just like Quebec does.

Parsley posted Misinformation. Inaccurate. Misleading.

In the doghouse,
Parsley

[parsley]

I'll be on your bad list chaff, because I posted "half-truths, mis-directions and flat out lies" last night.

Creston-Wyndell farmers bypass the CWB but are still in the Designated area. The CWB didn't remove them.

I wrote, " the CWB just took them right out of the CWB's Designated Area with one Board motion." Oh Oh

That is NOT TRUE!

Creston Wyndell is STILL in the Designated Area, BUT they are simply ISSUED EXPORT PERMITS by the CWB.

No buybacks. No pooling. No Board marketing. They sell/export just like Quebec does.

Parsley posted Misinformation. Inaccurate. Misleading.

In the doghouse,
Parsley

[Incognito]

Parsley:

And the CWB did this without changing the CWB Act or an Order in Council?

If you could get no cost abortions in BC and PQ but not in AB, SK and MB, what do you think the Canadian public would do?

How is it in 2006, in this country called Canada, that all people are not treated with equality?

Agstar - what say you?

[parsley]

About pooling, agstar77,

In organics, we sometimes sell flax to a company and they pool the returns, with the other organic growers' returns. This private company does not have a monopoly, either. Pooling works well, and participants are often more interested in pooling their returns, than not. We are well satified with the pooled returns, but have the opportunity to sell on our own when we choose. Dual marketing, so to speak.

Of course, the company's marketing performance DETERMINES whether or not we contract our grain another year.

What I find egregious is that the CWB is more than willing to forego pooling, which the farmers really want, but will fight dragons to keep the monopoly, which the CWB itself wants.

Parsley

[parsley]

Yup, incognito,

Without changing the Act or an Order in Council.

A Creston-Wyndell farmer still needs a CWB permit to export, but when he applies to the Board...BINGO...he gets one.

And his load goes across the border to a US elevator.

Parsley

PS The Creston Wyndell farmers didn't lie down on their beds and whimper and sob and wring their hands, wailing "Oh oh, oh, we need to change the Act, we need to change the Government, we need to change the regulations, we need to have an Order in Council, oh I'm doomed".

CW wanted to market on their own and they wouldn't give up until they could.
And they do. And they remain in the DA.