Read this you Pro-socialist CWB commies

[classicalliberal]

This article is pulled from a CME Group newswire.

Australian Wheat Export Regulator:
Demand, Competition Rises

Demand for and competition to export wheat from
Australia has increased since export arrangements were liberalized
July 1, 2008, Ted Woodley, chairman of regulator Wheat
Exports Australia, said Monday.
Responding to questions at a Senate committee hearing,
Woodley said 22 companies have been accredited as bulk
exporters, including former monopoly operator AWB Ltd.
(AWB.AU), and these are competing for wheat with participants
in the domestic industry, such as flour millers.
Of the accredited companies, 14 have already exported
bulk cargoes, a number that will soon rise to 16.
As part of the accreditation process, an applicant must submit
a proposal to export wheat, and while many of these might
be a little optimistic, the sum total of export proposals well
exceeds the amount of grain available for export, he said.
“That would indicate that the demand for grain exceeds
supply,” Woodley said.
Moreover, some of the accredited exporters are now selling
into new markets, while some are replacing wheat that they
had previously sought internationally with Australian wheat, he
said, without going into details.
“Now they are buying some, or in some cases nearly all, of
their grain within Australia,” he said. “The impression we’re
getting is that there has been an increase in competition and an
increase in demand for Australian wheat.”
Australia’s 2008-09 wheat crop yielded 21.4 million metric
tons, according to the government’s chief commodities forecaster,
the Australian Bureau of Agricultural and Resource With an annual domestic market of around 7.0 million tons,
the balance of production is available for export.
National production in the two previous years was reduced
by a drought, with the 2007-08 crop producing 13.0 million
tons and the 2006-07 crop 10.8 million tons, sharply reducing
the availability of wheat for export.
Wheat Exports Australia Chief Executive Peter Woods told
the Senate committee that more than 3.0 million tons of wheat
has been exported since October, the most aggressive export
and shipping program “for a long time.”

[wilagro]

Thats them not us. Apples and oranges.

[Fransisco]

Really? How is it different? Please explain.

[SASKFARMER3]

How is their system different than ours really explain, I am waiting please explain your comments.

[stubblejumper]

they can't haul to US elevators

[Fransisco]

What's stopping them?

[classicalliberal]

The wheat trade is the wheat trade, it behaves the same way any other commodity behaves. I guess the Australian Wheat Board and the Ontario Wheat Board are the oranges and the CWB is the apple. This is like explaining economics to government bureaucrats or people before the industrial revolution and Adam Smith how competition is better for all consumers.

[Fransisco]

Next you're going to argue that the earth isn't really flat.

[wilagro]

Fransisco: Well if the earth was round YOU would fall off if you went to the bottom side. So stay on top...much safer.

[vvalk]

WOW. What an intelligent argument. "There differnet". Absolutely amazing. It shows that arguing about this is futile. What else is there to say.

[Fransisco]

http://www.alaska.net/~clund/e_djublonskopf/Flatearthsociety.htm

[dmlfarmer]

Interesting read but it leaves me with lots of questions.

There is no absolutely no indication in the article as to the effect on farm gate prices. This report does not tell me if farm gate prices have improved, or are better than world prices. We only have to look at fertilizer to know that prices are no longer simply a function of supply and demand therefore even if there are more buyers it does not necessarily mean higher prices.

Second, how much of the increased shipping and demand is due to the huge drop in ocean freight rates over the last 6 months as compared to increased number of buyers.

Third, since exporters have to submit an export proposal amount in order to become accredited and (I am assuming) have to actually export to maintain their accediation, could there or is there a percentage of the sales are being made at cost or lower simply to achieve accreditation?

Fourth, what will happen to the 6 exporters who have not shipped wheat yet if they are unable to source wheat in the future or find markets. Will they disappear if they do not export? Will there be a rationalization over the next few years down to the few global grain traders who dominate the world markets? What will happen to the grains farmers contracted to them and will farmers loss money on grain delivered to these exporters if they go out of business?

Fifth, the article says "while some (exporters) are replacing wheat that they had previously sought internationally with Australian wheat."
Does this mean Australian wheat is being dumped at below world market prices in order to buy market share? Afterall, what country would be willing to pay a premium for Australian wheat given the world economy? Could Canada actually be losing markets because of competition between Austrailian exporters trying to export wheat? Could it be Australian export competition is driving down world wheat prices? Sure they may be selling more wheat but if Australian and world prices are lower who wins except the exporters?

Sixth, to state: "“That would indicate that the demand for grain exceeds
supply,” Woodley said" and base this statement on export projections of companies seeking export licenses is totally misleading without consideration of not only selling prices and also farm gate prices and profits made by exporters. We need this information before we know if the demand is real, or created by price manipulation.

While this report sounds very good We need a whole lot more information than a rosy report by an agency who was created and is dependant upon the success of deregulation. Enron reports were very rosy until we found out the actual facts of the pricing and sales of electricity were short term fabrications.