Does the CWB understand grain markets?

[parsley]

In France, from 1792-1794, the guillotine was used 100 times per day by a professional executioner called a BOURREAUX.

His job was to chop off heads.

Does the CWB have a secret tribe of borreaux travelling the West chopping off marketing choice opportunities with lying, half-truths, deception, slyness, hidden facts, stilted charts, doctored figures?

Chop. Chop. Chop.

If the CWB does, marketing choice farmers, in one way or another, will be paying for the Board borreaux.

Parsley

[charliep]

Off topic but interestingly the CWB posted responses to 2 of the 3 papers today.

http://www.cwb.ca/en/hot/producer/pdf/penner.pdf

http://www.cwb.ca/en/hot/producer/pdf/cooper.pdf

Always intersting when a response takes more space than the original article. Perhaps meant to be warm and fluffy like a down quilt on a winters afternoon where you can sleep knowing the rest of the world is passing you by and you are in no danger.

For those of you who are sitting on the fence, read and decide.

[charliep]

Doesn't relate the thread theme but perhaps to the title.

I note the CWB holds the barley producer pricing options as their answer to a new world.

If the CWB is confident in their pricing options, why are the FPC contracts (and from there basis levels) so poor relative to the PRO. $23.48/tonne under for both 2 row and 6 row?

Why is the basis so ugly on feed barley (what amounts to $40/tonne under delivered Saskatoon area)? If you can vote to retain barley in the CWB, I suggest you sign up on this contract. You can deliver feed barley at $40 under and allow the CWB to turn around/deliver against futures in the range of $15 to $20 under with an additional $20/tonne being added into pool returns.

[parsley]

The CWB states in the Penner Paper:

"Loyalty is earned through performance."

S0mebody needs to tell the Board that at least 20% of farmers want them gone. Kabuta. Bunked-de-booped.

Guess they didn't perform.

Parsley

[Fransisco]

Here's my favourite from the CWB Penner response.

<blockquote>"...and ignores a large body of work by independent academics that concludes farmers receive higher returns through the CWB."</blockquote>

How on earth can they keep claiming that the studies bought and paid for by the CWB are 'independent'.

These folks must have their own secret dictionary that no one else can check to go along with the secret databases used in their studies.

[BarleyGuy]

Heres the one I like from the rebuttal:

"14. Spot prices by their very nature will be higher than the overall pooled price which is an average of the high and low prices grain has been sold for over the course of the crop year."

If spot prices are always going to be higher than pooled returns, why do we want pooled returns?

[parsley]

Barleyguy,

You've earned yourself a beer.
chaffmeister gets a dozen!

Parsley

[BarleyGuy]

Parsley,

It always works out that way for him, but he does deserve them!

[parsley]

Poor old agstar can't answer, what can he say except mutter the dog needs to go outside before bedtime, and you can bet Vader won't come out from hiding under the bed (his favorite place to hide), so that leaves Burbert to defend the Board.

Seems about right.

Parsley

[craig]

I just finished reading the response to the Penner and Cooper papers by the CWB. It's so sad that because of the gag order the CWB is unable to properly respond during the plebisite.

[charliep]

Has the CWB ever released the paper/methodology used in the $116 mln claimed benefit over canola used in the task force response?

[chaffmeister]

Charlie:
The following is taken directly from the CWB Responses to Supplementary Questions Raided at the October 11, 2006 meeting with the special Task Force:


The CWB estimates that grain handling companies have charged almost 40 per cent more in basis than their actual handling costs <b>(footnote: CWB calculations based on CGC posted handling and cleaning tariffs and CWB observed canola basis numbers)</b> If the same handling companies had the ability to do the same for wheat, durum and barley, farmers' costs would increase by almost $8 per tonne or $145 million annually (based on a 5-year average of 18 million tonnes marketed through the CWB and handling costs of $19.34 per tonne). The CWB recognizes that rationing delivery through a contract call system rather than price can result in farmers carrying stocks for longer periods than might otherwise be the case. To calculate the magnitude of these carrying costs, it is assumed farmers store 50 per cent of their contracted tonnage 3 months longer than they otherwise would. Based on the 5-year average quantity marketed by the CWB and average farmgate returns, farmers' carrying costs are approximately $30 million annually. This assumes 8 per cent time value of money. Taking these carrying costs into account, the net benefit of the CWB's contract call approach is approximately $115 million annually.

http://www.cwb.ca/public/en/hot/task/