Husky Ethanol Plant Importing Corn

[IAMTHEMOLE]

100 car unit trains of US Corn set to be delivered to Husky ethanol at Lloydminster next week. Reason, not enough available wheat. Good to see Saskatchewan tax dollars hard at work supporting Saskatchewan Ag.

[ColevilleH2S]

You have got to be Kidding. $3.75USD Corn shipped from half a continent away, is cheaper than local feed. What where they offering for wheat that no one was selling to them? I've got a bin full of low protein HRW, and all my broker could find was $3.60CAD in my yard. I'm only two hours from Lloyd. Is my broker incompetent or is feed wheat shot up a whack-load in the past month.

[BennyHin]

Where is all the wheat going? CWB Deliveries? Surely not.

[BennyHin]

ColevilleH2S:

Perhaps if you lowered your target selling price to perhaps $2.50 fob farm (as Parsley likes to say), they would buy your wheat.

Welcome to the "N. American continental ethanol market".

remember ColevilleH2S: The ethanol manufactures will always buy the cheapest ingredients, corn is more efficient in the ethanol conversion process than crappy ole' wheat.

Perhaps Indian is a second alternative to your low pro wheat? I hear they our buying another 4- 5 MMT.

[Vader]

Competition is good!

[gregpet]

Let me think? Did the CWB keep corn from coming up before? Those open market proponents must be making it difficult for the CWB to keep the grain out. Oh I forgot, only western Canadian producers do not have that right, anyone else can sell into our market but we cannot sell into theirs, my bad.

[Ron]

The CWB did keep corn out by selling our grain cheap enough that endusers didnt have to import corn?

[Vader]

Democracy. You can make a list as long as you like about all the things that are wrong with it. But the alternative is worse.

[skhadenuf]

In the end all processors will buy the cheapest inputs for their product. That's the right thing for them to do. The right thing for us to do is whether we like it or not, is not fight amongst ourselves, because what we are fighting about is not the main part of the solution anyhow. I agree we need the right to sell our grain where we want to, but seriously don't think that it is going to be as major of a factor as others do for the simple reason as stated above processors will buy the cheapest alternative. Our real focus should be on the people buying our product. Some how we need to show them the value of our product namely food etc. We have a society that will pay 50,000 plus every second or third year for a new vehicle. If you look at the 50,000 vehicle sitting beside a 1990 1,500 vehicle aside from rust is there really 48,500 more of something there? No but the people marketing the vehicle control how many are made and convince us how much more stature there is in our life if we own one, which in reality is a lie, the real reason they want us to buy one is so someone on the assembly line can get paid $40 bucks an hour and everyone down the line including shareholders have a good living. Those same people paying the 50,000 for the vehicle are complaining if bread goes up a nickel because if it goes up a nickel they may have to drive the 1,500 rust bucket. Reality is if they paid the nickel more and had less to spend on the vehicle the people selling the vehicle would have to lower price and everyone down that process would get less. That is our real fight, not CWB or no CWB and our governments are pleased to fuel this fight so we occupy ourselves on a sideshow as apposed to the real problem. Because the answer to the real problem is that we in society recieve more of the consumer dollar. If we get more someone has less to buy vehicles etc, if that happens people begin to say gee maybe this gov is no good because I cannot buy a new truck every other year anymore.
It amazes me that someone would pay that 50,000 for a vehicle but yet say if you farmers charge a nickel more I'll just buy my beef or wheat etc. from some country where their quality standards for food are based around a society where rodents are a delicasy on their menu.

[parsley]

Vader,

I see you had a moment. Must be in the spring air.

"Competition is good" , you say? You had a moment of clarity! Congratulations.

Now, if you just learn how to apply that moment to the real single desk world!

Things could get exciting.

Parsley

[Ron]

Good to see you back Vader.

[BFW]

Fundamentally, I believe that if corn needs to come to feed livestock or supply an ethanol plant during times of shortages then so be it. The question that needs to be asked is why should taxpayers subsidize ethanol production in Canada if that production capacity has to rely on imported grain to do it?

[charliep]

Just a couple of comments. Don't know if the above is true (just back from holidays in beautiful BC) but will assume it is.

Grain producers will never have a higher value than when you are pricing on an import basis- price somewhere else plus cost to get it here. Normally, we are priced on a export basis - price where the grain is used minus cost to get it there. Lots of other factors in western Canada like ability to deliver to export market/CWB delivery contracts but this is the normal market function.

Also highlights the challenges of filling the supply needs of a value added processor. Husky at Lloydminster's capacity is about 350,000 tonnes a year or for nice round numbers 1,000 tonnes per day (25 B trains if you like). The unit train is likely about 90,000 tonnes or enough to keep the ethanol plant running for about 3 months. From Husky's side, what would it take to source that kind of volume from farmers over the summer?

A final comment is do we really understand the grain needs and specific quality/variety needs of an ethanol plant? How good a fit is CWRS for ethanol production? What impact does protein have? Gluten? Grade factors like sprout and frost damage?

[TOM4CWB]

Dear Charlie,

I think you skipped a cog on how much a unit train holds!

@ 90t/car... times 100 cars... that is 9000t not 90,000t! 9 days supply... not 90 days!

[wd9]

That darn BC sun!