Why is it that the CWB believes there should be one set of rules for them and different rules for everyone else. They claim that Agricore could post any price since it is not actually an offer. However when the CWB wants to compare prices through the board with American spot prices they always want to use Daily Price Contract numbers. These are prices that are not available to most producers because there is a cap and time line for participation. The CWB also has jumped all over the barley plebisite choice question yet in the past they have asked that very same question. Why doesn't the CWB admit that they forward sold a large percentage of malt this year before prices climbed. The reality is that the Agricore quoted price is in all likely hood much more reflective of world prices than the PRO.
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At CWB days in Saskatoon mid Jan 07. One of the speakers did admit they sold too much before the price increased. Reasonning is that they did not think the Aussi crop at the time was not likely going to have such a large shortfall in production and that it could have went the other way. So while the aussies were backing out of their contracts with China we were making up the difference. In my opinion I don't think that it was good marketting on the CWB's part. Just saying that I did hear one of the speakers admit it. That now it was a mistake and at the same time tried to explain that single desk selling is still bringing us a premium over multiple sellers.
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Also the speaker mentioned that at current malt prices the Chinese have pulled out of the market and are using other commodities instead of barley. Such as wheat and rice etc. and that the Chinese are good at making due with other than malt barley.
If there is some prices out there I would like to see them also as the CWB speaker would not say what level of price they have pulled out of the market and what level they will buy.
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I know the post is on prices but I like to look at the export volumes that support the prices. Barley exports August 1 to January 21 are about 674,000 tonnes versus 1.5 MMT during the same period last year. Can't provide up to date information on who the customers are but you can go to the CGC website to find out historical exports to the end of November (now free by the way). To the end of November, Canada had shipped 515,000 tonnes versus 1.1 MMT during the first 4 months of last crop year. The extra business during this period last year was Iranian (324,000 versus zero this year) and Saudi business (355,000 tonnes versus zero this year). The deliveries last year related to the joint feed barley programs offered by grain companies/the CWB and farmers desire to empty bins ahead of harvest. Wont' go into details but malt exports are sliding along as normal (in spite of Aussie and EU problems) except for the US which is running well ahead of last year.
Always begs the question how the CWB can short the market without having a firm signed contract from farmers or if they have, why didn't the CWB take steps to offset their risk (buy corn calls).
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Just read the quote from the CWB saying Agricore United feed barley only reflect a limited volume spot sale and are not the current market. As a marketing agency, why are they doing this? If this were a normal business, wouldn't the CWB be screaming I have good sales opportunities now and I need your grain/delivery commitment? Similar comments on malt barley.
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Charlie the story was covered in Reuters on line and I found no link to where prices were listed. Here's the link and it's long today.reuters.com/news/articleinvesting.ASPX?view=CN&symbol=&story.
They were quoting $233.70 per Tonne vs PRO of $190. both basis Vancouver.Found no reference to where prices are quoted but I'm sure Cam Dahl would know.
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What was their market outlook in August 2006?
Did they advise us in August 2006, to hold our barley for 5 months, and then sell into the domestic feed in December 2006, becasue they could predict the market?
The values they are quoting developed in December 2006 due to increase corn (feed) values and shrinking Aussie supplies.
Agricore sounds like another "could-have, should-have" marketing advisor. I can look at a chart after the fact and also look like a genius.
Why did they buy canola from you for $5-6/bu all last year If they knew canola was also going to rally $2.50/bu by December 2006????
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Nobody can beat the record of the Canadian Wheat Board's Marketing Department with their organic Specialist, Donna Youngdahl.
The CWB plopped out their Organic Marketing shingle in-house, of course, for at least 5 years. An entire department.
Only problem is the CWB didn't market organics.
Not a bushel.
So the CWB took money out of the conventional pools to pay the organic specialists.
Twiddlw. Twiddle.
Sudoku. Yawn.
Stress leave.
Stress money.
Agri-core needs to take a few marketing specialist courses from the CWB.
Parsley
PS Cam Dahl,at AU, you simply have to arrange to train your..." "could-have, should-have" marketing advisor"
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BennyHin
Just to help you see through the CWB fog factor, the price quoted is where new Japanese business feed barley business could be put on the books today. That would be a 25,000 cargo for likely shipment over the next 4 to 6 weeks.
When there is $40/tonne being left on the table, help me understand the single desk benefit that is described in the Schmitz, Schmitz and Gray study?
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BennyHin
One other piece of marketing advice for anyone who will vote for status quo/maintaining the CWB authority over export and domestic human consumption barley. If you grew malt varieties, take it around to all the potential selectors and if meets quality sell. The CWB needs this commitment to meet existing sales and to allow additional ones that would add value to the pool. If not, sign a deferred delivery contract on the "B" feed barley pool in February and delivery as soon as called for.
If you can't make these decisions in the current market, I have to question your loyalty to the current marketing system. To push what I said before, western Canada must look really stupid and incompitent to our customers who are putting high priced offers in front of us and yet you (farmers) get none of the price signals to react to.
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Too excited. Should be "B" pool guaranteed delivery contract - not deferred delivery. No forward pricing contracts (i.e. fixed price contracts) are available on the "B" pool. There are early payment contracts but you will have to look at the cost. As I indicated previously, sweetheart deals with a no cost 100 % EPO have been available last fall but in the current environment may not be available this spring.
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Charliep I think most feed barley is spoken for. As the CWB also needs farmers to deliver into the malt committment already contracted. There is no way that they want us farmers to know that that price is out there for feed barley. How about that a premium Japanese sale pounding down our door. Or should the CWB get credit for that premium?
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BennyHin
The Agricore price is what they deemed they could pay today for export feed barley. In an open market the buyer doesn't tell you when to sell. The CWB did nothing wrong in contracting a lot of malt barley early in the crop year( normal historic pattern) however with there supposed market intelligence they did fail in picking up what was happening in Australia. The reality is a marketing agency will never succeed in picking the top just as you and I won't. It is also true that a marketing agency will never totally succeed in meeting the marketing goals of every individual farmer because it doesn't know the variables a farmer is dealing with. Agricore has every right to post what they think they could pay producers for barley. It is not suggesting it could get that price for every bushel offered.
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