Sounds like a reasonable deal to me!

[AdamSmith]

Wow Burbert, you sure have jumped to alot of conclusions on this site, and all without even getting past the steno!

Maybe this could be your problem here?

[AdamSmith]

Or maybe, if you communicate with the people at your local HTP like you do with the people here on Agriville, it may explain why you can't get past the steno.

Think about it.

[AdamSmith]

Now back to the real world,

The JRI offer is,

basic feed $18 under dec for oct,nov dec delivery with a $35 premium for malting.

basic feed $22 under mar for jan,feb,mar delivery with a $45 premium for malting

they are sending me a blank contract for me to read over.

---------------------------

Just to note, also sold Canola for $9 even a bushel December delivery.

the deal was $22 under Jan, the market was rallying so I sold some at the market.

Sorry forgot to ask about the peas.

[Lifer]

Do you talk with them at all about next years crop or longer term contracts?

[AdamSmith]

Well, the short answer is No.

The long answer is, for us here in the extreme SW of MB, highway #3 corridor, we have a whole new (and positive IMO)situation after the SWP buyout of AU.

The HTP which I sell the predominent amout of my grain to is now Cargill at Melita (Elva), all the others are here as well. SWP/Agpro Boissevain, JRI Killarney (they were already there but did aquire the AU Killarney HTP in the takeover) Patterson Killarney, Louis Dreyfus Virden.

So my relationship has been mostly AU but I consider it wide open now. The Melita Cargill is still my closest point (1hr rnd trip, vs 2hr rnd trip for the others), but Cargill has offered squat for anything new crop yet, and JRI seems the first one out of the block to try and expand their market share.

As I hadn't even had one measly bushel of new crop anything booked just yet, opportunity presented itself with JRI, so I went with it.

[btjadenlepp]

couple things:
- imho 20 cent/bu vomi discount is pretty good so i wouldn't worry about that aspect of the contract.
- $1/bu premium for malt over feed is the best we've seen
- non-board new-crop malt contracts have been around for a few months in sk, but the terms are improving greatly as time goes on.
- peak price we found was $3.70/bu in tisdale for feed, aug/sep delivery. i figured it was going out of churchill since mb new-crop feed barley prices haven't gone above $3.50/bu, and i think they should be at a premium to sk values.
- according to the wce site, the oct forward contracts deliver in your area at $2/t under. i.e. if you have delivery space, there's $16/t there between the elevator's basis and delivering against futures (less costs)
- since we've been watching these things the last few months, the jri contracts have been the better ones out there. some companies haven't been offering much if anything on new-crop malt. others, interestingly those with malting facilities and/or otherwise short to the cwb, have been tying farmers up under 'first right of refusal' contracts on the barley whether it grades feed or malt, with no fixed premium or discount - all in all a very bad deal.
- i've also heard au and ldc are workign on new barley contracts this week. looks like the rumours of exports being done last week are true and concerns about the legal challenge less than a couple weeks ago.

[AdamSmith]

btjadenlepp,

thanks for the info.

other points were, malt (probably) going to Vancouver, which lends credence to the export business.

Malt to be delivered into HTP, possibly an extra incentive for trucking (something new for the non-boards).

Feed would be picked up in the yard. Thats worth about 8-10 bucks to me.

I think a little negotiation on the Metcalf vs six row is needed, but this is definatly a major improvement over the previous system.

If the domestics don't watch out, they WILL be left out!

[Lifer]

- $1/bu premium for malt over feed is the best we've seen
Can we see a higher spread from feed to malt in the different market situation? Allowing companies like JRI to be more innovative in the market should open up more opportunity.

I was disappointed to hear that our local AU is to become a sask pool. I'll go visit see if there is any change and go from there.

Nice to see these kind of offers around. Is it good enough? Could you do better? Do you need to? You can make that decision?

[btjadenlepp]

it's my job to help farm clients decide whether they can or should take these deals or try to do better, which changes from farm to farm depending on their own situation.

i like the new opportunities and today's prices though. this killarney deal is better than our previously-set targets and has the contract terms we've been waiting for. it took a few months for them to come available but now i'm running low on reasons not to start forward contracting some of all types of barley at these levels. maybe the price will go higher, i can see a case for it, but the chances get pretty slim at these high levels and the downside risk of doing nothing more than i'm comfortable with.

[btjadenlepp]

by the way burbert, this kind of information is out there, there's massive amounts of it and it's often very helpful in making better selling decision. but it doesn't very often fall into your lap like this. many smart farm managers, of all sizes and political stripe, pay consultants good money to gather price and market information, sift through it, interpret it and help put it to work for them. then they see a solid return on this investment. paying someone transparently to help market all your crops is actually a lot less stressful than freaking out about losing the cwb monopoly.

[AdamSmith]

I agree,

pretty sure I will book some barley into this deal,

just want to look at the contract first and get a better handle on all the particulars,

and decide the amount, 25% or 50% or more of a low ball estimate of production or go with a more realistic anticipated production.

The barley is still a long way from the bin.