Where is the premium

[kamichel]

Ok CWB fixed price 07 08 contracts if anywhere should be better at my farm because I have the higher of the CWB freight rates.
Dec. 07 WCE 3.36
SS CW 2 Row Pro 07 08 4.35
SS CW 2 Row fixed 07 08 4.64
Minus the 1.44 CWB deductions puts me at.
SS CW 2 Row Pro 07 08 2.91
SS CW 2 Row fixed 07 08 at 3.20

Compared to 2 row.
Less 39 cents for 6 row fixed.
Less 30 cents for 6 row Pro.


As far as I am concerned there is one big hose job here. If I am incorrect
can someone explain?

[charliep]

Just to add to your confusion, the PRO for standard select 2 row malt barley is $235/tonne (port) or $5.12/bu in the press release. See www.cwb.ca. I will phone the CWB about the confustion.

[charliep]

Finally got the answer. The PRO is incorrect on the FPC site. The PRO should be shown as $235/tonne/tonne (not $200 as shown). The risk, administration and time value of money discount used in the PRO is $21.88/tonne for standard select 2 row malt barley. Lets see. Wheat fpc at a premium to the PRO across the board. Durum at a small discount. Malt barley at a big discount.

[charliep]

Feed barley is even more interesting. Basis is $10.07/tonne over Western futures at Vancouver. Saskatechewan CWB deduction is about $50/tonne (making my math easy. That puts delivered Saskatchewan at $40/tonne under (about).

Western barley futures catchment area is around Saskatoon and is track/loaded truck at elevator (implications - you need to knock off an elevation plus some costs). Delivered Saskatoon open market should be in the range of $15 to $20/tonne under futures.

Quiz - If you were to sign a basis contract today, would you sign a CWB one or a open one?

[kamichel]

I see they have now changed the mistake in the 2 row 6 row pros.
2 row pro now 5.12 minus deductions
6 row pro now 4.72 minus deductions

Charlie there is one thing I don't get right now. Any chance you can phone the board again and ask them why the fixed prices on the malt are so much lower than the pros? Since your so good with this marketting stuff. The way I look at it if a pro is where it is then there must be sales at that level, so the fixed prices must be higher or equal to the pros for a new crop at this time of the year. In my eyes I can not see that it can be any other way. What is your take on that? Perhaps there is a mistake on the fixed prices also.

[charliep]

Will do a little later in the week. Will note again there is at least 1 maltster who is offering a $4/bu guarantee in Alberta for SS 2 row. Lee may have some comments when he returns from Grain World.