Bottineau Durum Price?

[Fransisco]

At the following website

http://bottineaufarmers.com/index.cfm?show=11&mid=6&theLocation=1&cmid=20&layo ut=1

the bid today(July 11) is $7.70 US for milling durum.

I'm assuming this is per bushel and that specs are similar to our number 1.

Am I right in this?

Sure kicks the CWB pro and fixed price if it is.

[Fransisco]

It does seem to line up with the prices wedino posted a few days ago.

[BennyHin]

Franny:

How many tonnes will they buy at that price?

Is the price due to a current shortage of milling durum? We're they caught short? If they are short it probably means farmers don't have too much left on the farm to sell. How many tonnes remain on US farms?

Also, where did all the durum go? Why are the stocks so tight and the bids so high?

My elevator agent called me today, told me the CWB has an open call for durum for immediate delivery.

Perhaps the CWB should not have accepted all my durum this year, and should not have sold so much durum this winter. Instead they should of held stocks back on the farm so that they could sell into these current higher prices.

I'm sure a certain farmer from Cypress Hills-Grasslands would not have minded the CWB telling him last fall that they were only accepting 50 or 60% of his durum because they thought the prices would improve later next year.

But this same farmer also accuses the CWB on a regular basis of being an inefficient marketer because it doesn't always accept 100% of his durum contracts ever year?

Franny:
I cant wait for the Frontier Center out of Winnipeg to publish yet another cartoon-ish, so called research paper explaining how all Western Canadian durum farmers can capture the highest US elevator spot price of the year (in hindsight of course) by selling 4.5 million tonnes of Canadian durum into North Dakota at this price.

By the way do you know how a basis is calculated? If 4.5 million tonnes are offered into a market at a single point in time, what do you suppose would happen to the basis?

Oh yeah, that reminds me Franny, what happened to the durum futures exchange in the USA? Where is the transparency south of the border?

What is your call on the next new crop durum PRO? Will it go up or down?

[bobn]

Berthold prices are nearly the same.
(South of Weyburn)

$7.25USD or $7.63 CD sure beats our $5 net to farm PRO!!!! a 50% discount for CWB durum! nice gift for our customers though? No wonder they don't like the open market.

http://www.bertholdfarmers.com/

Cash Prices July Aug/Sept Oct/Nov Jan
Spring Wheat$5.75 5.65 5.75 5.80
Durum $7.75 7.25 7.25 7.25

[Fransisco]

Just looked it up on google maps

http://maps.google.com/maps?tab=wl&ie=UTF-8

Its actually south east of Weyburn and Estevan.

Thanks for the website. Always good for price checking.

[Fransisco]

I'm also curious to know more about what Kevin Hursh is saying here.

"Big turnaround in durum sales situation Durum producers are able to market all they want to sell this year – a big change from the previous two crop years. Sales opportunities are so good that the Canadian Wheat Board has issued a Guaranteed Delivery Contract for No. 1, 2 and 3 durum. Guaranteed Delivery Contracts have been issued in the past for No. 4 and No. 5 durum, but not for the top grades. With the GDC, producers who have not already committed their durum under a delivery contract have another opportunity to move their grain. The sign-up deadline is July 31 or earlier depending upon CWB sales commitments. Delivery opportunities are available immediately upon sign-up. For this crop year, the CWB has accepted 100 per cent of the durum offered by farmers under delivery contracts. In the previous two years, that was not the case. This led to some problems. Some producers inflated the amount of durum they offered for contract so they could move a greater volume. The CWB implemented a bin audit system to cut down on abuses. In the current situation, some producers may want to hold any uncommitted durum and sell in the new crop year since the new crop Pool Return Outlook for most grades is five to ten dollars a tonne higher. Other producers may want to sell in the current crop year due to cash flow and bin space considerations. I'm Kevin Hursh."

I must not be looking at the right place on the CWB website for it.

[Fransisco]

Here's another Sun Prairie Grain in Minot and Bowbells

http://www.sunprairiegrain.com/index.cfm show=11&mid=3&theLocation=1&cmid=3&layout=1

$7.65 US

[bobn]

Fransisco

For Guaranteed delivery of durum see http://www.cwb.ca/public/en/farmers/contracts/guaranteed/#durum

It's not very clear on what crop year. Maybe is about old grain only? Anyone know for sure?

[Fransisco]

Okay so what about prices? So far all I have found is the early payment option price for 06-07.

http://www.cwb.ca/db/contracts/ppo/ppo_prices.nsf/epo/epo-durum-2006-20070711.html

[bobn]

All I could find is this with no details on how it's calculated.

Durum
Fixed Price Contract Sign-up February 26, 2007 7:30 a.m. CT Sign-up deadline November 1, 2007

http://www.cwb.ca/public/en/farmers/producer/fixed/

[Zaphod]

Benny, the ND price at all locations is much higher than the CWB and has been for at least 8 months. The US also exports durum and the world values are reflected in the bids made to ND farmers. Thus, that price is not just a US miller price, but is competitive in the global market (worked back to an interior price). So, if a million tonnes were sold to ND elevators, they would be able to turn around and ship it out to Italy or Morocco at a profit.

[Zaphod]

Oh, and by the way, the transparency in the US market is called the internet. Lots of prices are available at any time from at least 30 locations. And you can get all kinds of HRS prices too. The CWB must just hate that level of transparency. It kind of destroys their ability to manipulate the DPCs.

As far as the direction of the PROs, who knows? That would require a logical response to an illogical situation.

[AdamSmith]

Benny I'm sure you won't believe this, but in response to your above post, go to the following site as it will explain in great detail what you just can't seem to grasp.

Oh by the way, enjoy!

http://piv.pivpiv.dk/

[BennyHin]

Zaphod:

you said:

"Oh, and by the way, the transparency in the US market is called the internet. Lots of prices are available at any time from at least 30 locations".

first of all, the old cliche is never believe every thing you see on the internet (Zaphod: with respect to email spam, how much money have you sent to Nigeria? How many of those blue pills have you bought? What about those lovely ladies who want to "get to know you better", etc).

The internet is ripe with modern day snake oil salesman.

But what is the difference between the internet and the ability to use a a telephone on a regular basis to find out what various companies are paying for grain?

Did you know the telephone has been in most W. Canadian homes since the early 1930's?

Oh, by the way, with the advent of the internet and other technologies, the buyers have even more information at hand than you.

With improvements in remote sensing or satellite imagery, the 5 or so big grain buyers and national governments are becoming more educated as to what you are growing, and what your yields will be. The resolution of these satellites are quickly approaching a square meter capability, and the mathematical yield models are achieving R2 values that are providing very accurate yield predictions at a field specific level.

[Zaphod]

Have you ever gone to web sites of US grain elevators (most of them cooperatives)? Many of them post their prices daily. In Canada, only AU has ever had the guts to post their prices. And what you see with their prices is that they are usually the lowest prices you'll get. Why would any company in their right mind post bids above the market?

You're right, it's no different than the phone, just a little more convenient. You're starting to sound a lot like Oscar Leroy from Corner Gas. Just a crotchety old geezer who's against any new-fangled idea.

But if you want to act like farmers are stupid and incapable of marketing, then I understand your choice of the wheat board. I for one, give farmers way more credit than that.