CWB system is padding the pockets of U.S. grain companies

[Fransisco]

From this weeks Agriweek,

“So far in the 2006-07 marketing year which began last June 1; private U.S. grain companies have exported 587,000 tonnes of durum wheat. The Canadian Wheat Board's durum exports include at least 250,000 tonnes to the U.S.

The American durum wheat harvest last fall was 1.44 million tonnes. Domestic use is 2.29 million tonnes. The U.S. agriculture department expects total 2006-07 imports, virtually all from Canada, at 1.12 million tonnes.”

[Fransisco]

“Do the math. How can American grain companies export durum at the rate of 60,000 tonnes a month when the country's total durum production is 680,000 tonnes short of its own domestic needs?

It looks like the American grain trade is buying more and re-exporting the rest at a profit, in other words at higher prices than it pays the Board.”

[Fransisco]

“Nobody could possibly expect that astute U.S. grain traders are buying Wheat Board durum at the premium prices the Board claims to be commanding due to its single-desk market power, then selling it offshore at a loss to undercut the premium prices the Board is supposed to be getting in those markets.

It is far more plausible that U.S. traders are buying Canadian durum cheaply and exporting it at higher prices. Exports in 2006-07 will equal 38% of domestic U.S. consumption.”

[Fransisco]

“Much the same can be seen in barley. About three-quarters of the barley in U.S. domestic and export commercial trade is malting barley. The American barley harvest last year was 180 million bushels while domestic needs are 205 million. Imports, again exclusively from the Wheat Board, are estimated at 15 million, but the U.S. is also exporting 25 million bushels this season. Year-end carryover will be reduced by 35 million bushels, but again American traders appear to be able to buy Canadian malting barley for less than they can sell it for export.

Put another way, it is more profitable to sell American malting barley offshore than to sell it to American maltsters who have access to cheap Wheat Board imports.”

[Fransisco]

“The only possible conclusion is that the Board cannot be getting premium or even competitive prices in the U.S. American grain traders can take the same or equivalent durum and malting barley and sell it to third countries in effective competition with the Wheat Board.

If there is another explanation, then here is a chance for the Board to devote one of its daily self-congratulating news releases to the subject.”

[Fransisco]

“Where you don't see this happening is in oats. The U.S. has long been a net importer of oats and virtually the only buyer of Canadian oat exports. Its harvest last year was 94 million bushels, requiring imports of 105 million. U.S. oat exports are expected to be only 2 million bushels. Oats are priced in a single, competitive, visible and transparent market.

If Canadian oats could be sold elsewhere at higher than U.S. prices, Canadian exporters would be doing it.”

[Fransisco]

Okay all you die hard board supporters, explain this please?

[Fransisco]

What do you think about all these US companies getting rich off your grain?

[Fransisco]

And what a wonderful job the board is doing 'managing' the supply of malt and durum.

[Fransisco]

This all sounds to me like the Algerian definition of 'preferential' prices.

[Fransisco]

Vader, Agstar, Burbert, Bennyhin? Anyone?

Come on guys, it's time to start the spin machine.

Tell us all about how the numbers aren't real because they didn't come out of Gray's theoretical mathematical model.

[SASKFARMER3]

For two long I have said this is happening (trip south Late October US price Durum 5.75 US a bushel) All my durum shipped to Agricor united shipped to minneapolis to ADM CWB pays me $2.72 bushel for #2 freight off CWB supporters explain please in all your wisdom. ITS NOT JUST A SPOT MARKET WE ARE SUPPLYING THEM THEIR NEEDS IN A SHORT MARKET.

[wilagro]

Perhaps you could get someone from the Winnipeg Grain Exchange to explain it to you. Grain trading seems to be beyond your comprehension, otherwise "why the questions"?

If you want knowledge...seek the knowledgeable to learn from.

[Fransisco]

I think its happening all the time. The only thing the board staff know how to do is price below the market.

In an open market competition disciplines all the players.

Who disciplines the board? No one.

[Fransisco]

There you go, Willagro is perfectly happy to subsidize US grain companies at his and your expense.