3rd Party Risk on grain sales...

[charliep]

TOM4CWB

Will be very interested in the results/recommendations of the study lead by the
pulse growers but participated in by other commodity groups of alternatives in
managing transaction risk.

[TOM4CWB]

Charlie,

The individual transactional risk the CWB encounters are covered by the pool accounts... and everyone is averaged out.

Flying blind and not knowing what you are paying for risk management is working fine for you?

How much do you think bad/defaulted contracts will cost the pool accounts this year?

Do you actually think the CWB will share the truth with us... on high value wheat contacts they have had to rip up because of problems completing them?

With customers knowing the pool covers us... why should they worry about backing out on high value contracts...

when they wouldn't dare do this to US Companies... could this in fact explain a portion of CWB problems competeing with US DNS prices?

[TOM4CWB]

Stubblejumper:

"Flying blind and not knowing what you are paying for risk management is working fine for you?"

Interesting perspective... if you can't tell... then it doesn't hurt!

[dave4441]

I would guess that most of the CWB sales are to governments, not companies, so would guess there risk is not as great in the big picture. Saying that, risk does come from government buying agencies but probaly less so then some of our special crop problems

[padron]

For clarification - In Australia there is no form of bonding or "fund" protection. Growers are completely on their own. The Australian Grain Exchange will form a key role in providing security through their clearing services. It is a good model for us to emulate in my view and the clearinghouse project is in regular contact with our "mates downunder".