How long has the CWB Annual Report been out?

[Incognito]

Charlie says:

"I also note the programs ran a $6.7 mln deficit"

Vader & Chaff:

FX? Grain hedging? Basis Management?

D) all of the above

How is this possible with staff dedicated to risk management?

Consequences?

[TOM4CWB]

Chaffmeister,

I appreciate your ability to "bang your head against a concrete wall" for the purpose of exposing folks to our understanding of the truth.

Your JFK quote says soooooo much.

Figures can lie, and Liers can figure.

I appreciate your attempt to shed a little light on the subjects that are politically relevant and forefront in many of our minds...

Hopefully there is a little entertainment value as well!!!

God Bless Canada!

[TOM4CWB]

Incognito,

The CWB can make up any number they please... as they don't match the risk management with PPO contract directly anyway... as Measner explained to me.

We complained too much about the adjustment factor... hence a loss is created to make and justify CWB policies look acceptable.

Just a simple solution to a problem my small mind would see... if I were in charge down at the CWB! (Not that I agree with the fee!)

[charliep]

Annual report is there for those that want to look at.

http://www.cwb.ca/public/en/about/investor/annual/

[charliep]

No other posts so I will stir the pot.

Pick on durum. FPC use - 2,658 tonnes. EPO use - 402,000 or about 9% of the pool size. Farm carryover July 31, 2006 - 1.65 MMT or up 64 % from the previous year. Stocks use ratio - 64 %. Help me understand how a business can afford the above? At least farmers should be using the EPO.

Malt barley. FPC use - 1,206 tonnes (less than what some of you grow). and the cost of putting out malt barley fpc prices/basis is? Much better than the "B" train of tracking that was done the previous year. EPO - 295,000 tonnes or about 20 % of CWB malt barley pool size.

Feed barley (A and B pool). Won't talk about fpc numbers (you can look and come to your own conclusion). I note the heavy participation on the A pool EPO (781,000 tonnes versus a pool size of 916,000 tonnes) - a sign that when grain companies and the CWB work together to put market signals, things do work.

I encourage all of you to spend the time reading this document over.

[charliep]

No one cares but will try again.

I note with interest the barley A and B pools. Interesting farmers sold the most volume at the lows. The CWB is a feed bareley bin cleaner/seller of last resort.

Will note the interesting adjustments in the direct costs - other grain purchases (note 16) and other direct expenses (note 17). Can someone help me understand these adjustments?

[charliep]

Incognito

maybe the answer to your question is none of the above. The CWB is in the business of managing risk of the producer pricing options relative relative to the overall pools (their risk). They hedge their risk in these programs across a whole crop year until sales are made. Would have to know how much of the programs is futures/options based (Fx, wheat, etc). How much is derivative based (will have a cost)? How much is funded by the CWB themselves (self insured/use the contingency fund as a back up)? Basis risk the one element the CWB will struggle with the most (not good products to lock). Similarily there are all the issues in program design itself (using initial spreads versus market based ones).

I will note that most steps the CWB takes to manage pool risk pushes this risk back on the users of the contracts.

The easiest step and lowest cost would be for the CWB to allow pricing completely outside the pooling system (real cash prices for a percentage of crop). Managing risk around this would be relatively easy, low cost and effective. The biggest difference would be the actual market basis would be tighted into actual farmer contracts.

No posting so talking to myself. No one cares so why should I.

[Fransisco]

Just came down the thread Charlie, carry on. You're pulling some interesting stuff out of the report.

Your highlights help inform those don't have the interest ime to read the whole thing.