Rayglen Malt Wanted

[charliep]

Tom4cwb

I have to go along with rain on another thread. I am a barley seller including malt. Everyone has to their own numbers on the malt versus feed decision but if you have malt and prices are competitive, I would fulfill existing contracts and contract more. The logic is not to look a gift horse in the mouth - adding to existing malt barley sales will increase the current PRO rapidly. From a long term perspective, it also shows our customers that western Canada has a commitment to meeting their needs. As indicated before, western Canada must look pretty foolish when our customers are banging at our door with high prices and the CWB has nothing for sale.

[charliep]

Back home after a few days away and pick up my western producer/read. Some good editorials/articles. Also noted the "CWB Ponders Barley" article (page 43/Feb. 15 edition). Maybe Vader can help us understand implications. May explain some of other CWB actions/communications with customers and partners.

[chaffmeister]

kamichel said:
Since when does a malt company source barley? Monopoly = only CWB is responsible for sourcing barley. CWB responsible to ensure supply.

REPLY………..The malt company is responsible for sourcing – through selection process. It really is stupid……..the CWB sets the PRICE to the maltster. And that’s it. The CWB plays absolutely no role in sourcing. The maltster must somehow compete with the local feed market to source / select the barley it’s already bought. There is absolutely no connection between the contract price with the CWB and the realities of dealing with the farmers.


Evader said:
Big difference sourcing through the trade (brokers or grain companies) when you have a monopoly versus when those same companies are your competitors in an open (dual) market!

REPLY………Evader has missed the point altogether in order to slap us yet one more time with his trite rhetoric. He’s right – there’s a big difference between sourcing through the trade (brokers or grain companies) that stand behind their contracts and dealing with the CWB which doesn’t even assist in sourcing at all – you’re on your own, buddy. WHAT GOOD IS THE MONOPOLY IF IT DOESN’T EVEN STAND BEHIND ITS CONTRACTS? THE MALTSTERS ARE FORCED TO PRICE THROUGH THE CWB BUT THEN ARE LEFT ON THEIR OWN TO ACTUALLY GET THE BARLEY. WHAT A BLOODY MESS……


Evader said:
What makes you think that the CWB is not getting the same high spot prices you are referring to for sales they are putting on the books today.
We all get an average price for the year whether we sell through the CWB or not.
Let's have some honesty here on Agri-ville!

REPLY………Evader doesn’t get it – again.
Someone should tell him that the CWB is not selling malt barley right now because they have too much on the books and they know they can’t compete with the feed market.
And yes, we all get “an average price for the year” – just that some get a more average price than others. And there is a genuine concern for the malting industry when the CWB is so dysfunctional that malt barley is moving into the feed market and the only one to blame is the CWB.



Evader said (a few more things):
1…The malsters are free to introduce these incentives anytime they want to.

REPLY………..It’s still a sign of a dysfunctional market.

2…What they did in 02/03 proves to me that they can take advance deliveries and pay storage.

REPLY………..The maltsters did not “take advance deliveries” and “pay storage”.

3…The CWB has no storage unless we make producers pay for it.

REPLY………..The CWB pays grain companies for storage; why couldn’t they pay farmers?

Egad. What will it take……



Even more Evader nuggets:
1…If you want the CWB to be a broker thats fine. That won't be the same CWB we have today.
REPLY………Perfect. Now we’re talking. If you haven’t noticed, the ones you’re arguing with don’t want the “same CWB we have today”.

2…It won't be any different than a hundred other brokers. It won't add value to farmers.
REPLY………If it’s the same as other brokers it WILL INDEED add value to farmers. Why do you think farmers (or anyone else) deal with brokers? It’s because they can get them something better than the farmer can get himself. If all it does is reduce the search cost for the best deal, then THAT is the value it has added.

3…If it is there at all it will be to add profit to its own bottom line. It will have a limited ownership structure who may or may not be farmers. (probably not).
REPLY………Very, very narrow thinking. You guys at the CWB really do need an “attitude adjustment”.

4…The CWB must be able to expand its business to remain strong. It must be allowed to market other grains and it must be allowed to own assets. There is not another major grain company on the planet that is not allowed to make capital investments.
REPLY………The CWB is not a grain company.

5…The interest earnings on the foreign debt would have been a great way to start an equity base for the CWB if the legislation permitted that…
REPLY………The feed barley interest certainly is going into the Contingency Fund – a fund set up to manage the risk of the producer payment options. If the legislation doesn’t allow starting an equity base, better tell the CWB.

[TOM4CWB]

Chaffmeister,

The saddest part is this:

The CWB Managers were offered $BILLIONS$ if they would transition into a multi-seller system over 5 years... almost two years ago.

We would be close to half the way through the transistion now... have $1.5b debt free truly grower owned facilities and terminal elevators...

But oh no... Goodale/Alcock were laughed/sneered at... and growers not even offered the option.

We don't deserve a farmer owned elevator system... because we have proven time and time again... that W CDN growers have no clue how to run an effective grain marketing/handling system. We just waste away the equity built by others sacrifices... till there is nothing left!

Sadly enough... Vader is a perfect example of why it won't work.