Attention CWB PRO Day - Guesses PRO Increase/Basis

[charliep]

By the way, if you grew 1000 acres of wheat which yielded 36.7 bu/acre (1 tonne/acre), your revenue in crop year 2006/07 has just been reduced by $5,000.

[btjadenlepp]

...IF you kept it in the pool.

if you marketed all of last year's crop via the ppo's and non-board market you should have done substantially better, and you don't care much what the board does at this point. that's my position anyway.

but i just got off the phone with a reporter who had been speaking the board about this, who had given the impression that it doesn't matter if old-crop returns go down because farmers can just market that wheat in the new crop year at the higher price.

As if it's that easy! just because they come out with this high protein storage program and jimmy with the old-crop/new-crop spreads it's not like farmers can or should just re-arrange their delivery plans. we've been looking at the premium in the 07/08 fpc over the 06/07 pro for months trying to find a way to carry over supplies for the higher price (plus the better premium in the intials), but few individuals can manage or justify it given limited storage space, big yields on the way and better upside potential in other crop markets.

to be clear, it's the 20% delivery quota - if we're lucky - that's bunging things up. can matter a lot more to returns than the pro's.

[silverback]

How much high protein wheat is actually left in the bins to take advantage of this "gift" from the board?

Around here, the elevators clean out the high pro stuff first (when they can).