Really recognizing the one thing I hadn't focused on about having so much wheat forward contracted today since we've gone to feed grade on our wheat... delivering feed wheat at a $20 discount on a $260 #2 contract is SOOOO much nicer than delivering at $75 when #2 is $140ish cash price. Got a couple of neighbours now running 8-10% fusarium on SRW who've been sent home with their crop in hand.
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Did you price open market or Ontario Wheat Board.
Will note the 2009/10 fixed price contract is off about $75/tonne
(December) from the highs. No competition for the CWB so no reason to
fix grade/protein spreads at the time of signing a contract. Feed wheat
and CWB contracts are a particularly painful experience in the west.
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Don't know if it will be of interest to you dalek but here are current prices for soft white spring wheat (as close as we get to SRW).
Current price contract 1CWSWS (not sure on protein but am going to assume a 9.9 to 10.8 %) is about $153/tonne. This is port based so you still have to deduct freight and elevation - about $53/tonne Alberta. that is $100/tonne if you sign an fpc today and deliver local elevator.
If you had a grade of 3CWSWS or Canada feed, you would deduct an additional $27/tonne. $73/tonne elevator Alberta. If you had sample CWSWS on account fusarium, the deduction would be $50/tonne or $50 in a farmers pocket. The deductions are based on CWB initial payment spreads (the way the program works) and the CWB has the ability to deduct additional amounts for feed grade (don't in the case of CWSWS but they take an additional $3 to $9/tonne off other classes).
I won't go through the PRO as still July and the forecast likely has about $20 to $30 to drop next Thursday.
You can compare you and your neighbors price to that available in western Canada.
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hopperbin
First I have to check your question to see if there was a freudian type slip.
I assume you meant how the PPO contracts worked for the farmers who
chose to use them and not the effectiveness of the programs in terms of
the CWB. If this was the question, then we will not know the answer until
next February when the CWB releases the full accounting for the PPO
contracts and the implications for the contingency fund. Indications are
the CWB profited from the PPO contract to point the contingency fund is
back in the black - rumors only but needs to be put in the context of
much lower volume usage in 2008/09.
For a farmer perspective, your results relative to the PRO need to judged
in terms of your price timing decisions.
The PRO from 2008/09 is $304/tonne port (1CWRS 13.5). The FPC over
the period March to July 2008 varied anywhere from $290 to $435 (Mar
2008) with a top end of $360 likely more realistic pricing opportunity.
Both the FPC and flexpro crashed thereafter starting in August 2008. The
FPC/flexpro ranged more in the $250 to $280/tonne range thereafter for
the remainder of the actual 2008/09 crop year - well under the $304
promised via the PRO.
More simply, a farmer likely beat the PRO price if they priced prior to
August 1 2008 and at a substantial discount if they used one of the
programs to price during the actual crop year.
things to look at.
http://www.cwb.ca/public/en/farmers/producer/historical/pdf/2008-
09/2008-09fpcbpccharts.pdf
http://www.cwb.ca/public/en/farmers/producer/historical/pdf/2008-
09/2008-09flexprocharts.pdf
New crop - provide the graphs and you can come to your own conclusion.
http://www.cwb.ca/public/en/farmers/producer/historical/pdf/2009-
10/2009-10fpcbpccharts.pdf
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