Warburton Wheat and the CWB

[lakenheath]

Some of my neighbours fear that the loss of the CWB would be the end of the Warburton program. This program has been very good to farmers in our area (50 cent premium).

From my perspective, the program would transition quite easily into a none CWB environenment.

Warburton would demand the same varities grown and same grading standards. Paterson and the other companies involved know what Warburton expects and they have delivered in the past. It would just now be a direct channel to Warbuton.

I am missing something here? Same goes for the Navigator, Commander and all other IP programs.

Is the fear that we will lose the 50 cent premium that the CWB guarantees?

[silverback]

Sorry, what area are you in again?

[lakenheath]

Southwest Saskatchewan. Why?

[silverback]

I was just wondering if the wheat variety you speak of is only suited to that area?

I might be more inclined to support the current system if I could be guaranteed that kind of premium every year.

You don't suppose there are varieties developed for Alberta that might....?

[charliep]

The Warburton program started in Manitoba (Man Pool days) but has gradually moved west as the fusarium issue reared its ugly head. Was at a meeting 4 or 5 years ago with Bob Beard (Warburton purchasing director) at Swift Current and they were contracting some in this region. Don't think the contracts go much north of the trans Canada. Varieties contracted were Teal, Barrie and Elsa (hopefully someone with correct if I am wrong/spelling is bad). Certain agronomic restrictions and record keeping requirements.

If the CWB provides value to the customer and the supply chain process, why won't this continue in a CWB 2 world?

I would call the Warburton contracts a value chain. If the CWB were not involved, would this value chain cease to exist? What would change?

[lakenheath]

There are 4 varities right now. Elsa, Teal, Infinity and Agricore has one (not sure of the name). They are basic HRSW varities (I guess they just bake out a bit better than others such as Superb, Barrie, McKenzie, etc). But yield, disease and other traits are quite equal. I believe Superb has a higher yield ranking, but I don't think it blows the Warburton varities out of the water.

[charliep]

I should note that Warburtons is a UK company so all the draw is off the east coast (reason why it doesn't come to Alberta). I suspect blending/loading individual holds are also easier out of TBay/the St. Lawrence ports.

Similar premiums are available of the west coast for Japanese but has never evolved into a Warburtons type value chain. Blended product with no variety restrictions are quite satisfactory as long as contract specifications are met. Premiums are distributed to everyone through the pooling process.

[ianben]

Warburtons have variety secific premiums here in UK mostly run through Centaur grain http://www.centaurgrain.com/about.htm.

I am sure Warburtons will still want your wheat as they sell a branded loaf at a premium price and your wheat is necessary to maintain their taste and quaility.
The interesting thing will be finding out if CWB has been getting the best deal. Warburtons will pay but only for the quality and quantity they require.
Difficult for individuals to deliver year on year and why I believe they use Centaur over here.

[lakenheath]

Are you guessing that the 50 cent premium we are getting from the board is less than we might get without the board. Is some of the premium subsidizing the other pools? How do we find this out?

[ianben]

A 50% premium sounds very good but I have no idea of the availability and quaility of your Warburton wheat.

I believe Warburtons could pay much more as your wheat is necessary for their brand and premium.

However I am sure they are trying to replace your wheat with cheaper alternatives, contracts are available here for growing Canadian type springwheats right now, and if an alternative becomes available your premium will disapear with or without the CWB.

[lakenheath]

50 cents not 50%

Where are you from?

Our weather plays a major role in the quality of our grain also. We do have an advantage in that regard.

Hopefully we can keep the Warburton contracts, but if not we should be looking for other niche markets like this one.

[chaffmeister]

Lakenheath: Last time I talked to anyone in-depth about Warburtons, the majority of the premium paid went to the pool.

Question - when we talk about the Warburtons premium, is this over the pooled price, over what the "market" is at the time, or over the CWB's selling price at the time?

[AdamSmith]

I contracted Barrie this year to Warburtons. $20/t premium.

But I lost my trucking premium of $7/t

Wheat graded #2 with Warburton, getting #1 for the same wheat at an AU HTP elevator so that's another $4/t

Had to buy cert. seed for the Warburton
vs cleaning my own. That extra cost worked out to about maybe $3-$4/t.

So the true net premium for me this year, backed off to the farm was $5/t.

When Warburtons first came to MB, back in about 94 or 95 the rep came out and talked to the local growers, I asked him what they were paying for this wheat basis their mill. He told me It was huge so we backed off all the costs like England shipping and Ocean freight, right back to Thunder Bay at the time. Then deducted our freight and elevation costs added in the then $30/t premium and we calculated there was still $75-$80 per tonne missing.

That's what goes into the pool, then they lowered the premium to grab even more.

This year was the first year since that first year that I grew warburton.

Probably won't next year.

[silverback]

I know I have been awake way too long, but if the warburton contracted wheat pays the premiums to the farmers who are growing it, why are the premiums from the fpc/dpc dumped into the pool accounts.????

Sorry, tired.

The varieties listed aren't all that odd are they?

[ianben]

lakenheath I am in UK near Liverpool not too far from Warburtons bakery. I think your wheat will pass our farm on the way there but will be flour by then.
We deal in tonnes only over here, no bushels, so this is why I misunderstood.
Adams $20/tonne I understand and would be equivalent to the £10/tonne Warburtons pay for Herward(their favored milling variety here)but again that is for a grade above 1. They really do want only the best
Here the farmer would recieve all that premium personally with no deductions other than normal ones on any other grade.
I have never managed to make this grade but is run the same as the Coors malting contract they do for barley which I can meet.