CWRS Market signal

[parsley]

btw tinker, you drinkin' the red stuff? You'd better be. Call me. lol Pars

[TOM4CWB]

Parsley,

I will get with it today!

Thanks a bunch!

[dmlfarmer]

I am always amazed how individuals posting on Agriville state a position based on just one piece of data and then ignore everything else.

In this case posters are raving about the efficency of the open market based on Mar 31 statscan numbers and how the open market has been able to move the record crop we produced last year. Yet further digging in those same numbers shows on Mar 31 on farm canola stocks were also up 40.6 percenct over 2008 and peas were up 93 percent over last march 31.

Second, no one talks about the increase in world demand for oilseeds and the fact Canada is a leader in Canola production. Please provide a comparison in the increase world demand/production of canola and of wheat. I believe we are trying to sell wheat into a flat market whereas canola is being bought by a world in which demand is growing for both cooking oils and for bio fuels.

Third, factor in the effect of the global economy. What impact of the credit crunch and the reluctance of buyers to forward price and take delivery had on both crops?

Finally, I put forward the deregulation of the Australian market resulted in an early flood of wheat on the market due to Australian grain companies seeking market share. Agressive selling by the CWB in this time period likely would have reduced prices, and increased shipping costs.
This too must be factored in to any conclusions made as to why there is a greater demand for CWB wheat now, why the CWB needs deliveries now, and if an open market is more efficient.

Production numbers alone do not make a valid argument. All of the above factors, and a host of others must be weighted in before a valid conclusion can be reached

[jensend]

now you've done it! way too many facts for agri-ville. in spite of all the rational information you put together you still have to come to the conclusion that the wheat board is evil and the large grain companies are a famer's best friend.

[TOM4CWB]

dml/jen;

Talk about rants.

Our Canola is all gone...

That central marketing/planning is the answer to our problems... well I think you have missed the mark by a country mile.

[Fransisco]

Oh goody, a Sunday morning challenge! You want more evidence? You want more facts? Grab a cup of coffee and check out these...

Over the long haul the rest of the world is exporting more wheat all the time while we are exporting less.

http://rolfpennerforcwb.com/2008/11/08/all-wheat-exports-%e2%80%93-canada-and-world/

The average returns from the wheat board are always below the average open market price.

here's new crop

http://www.siemenssays.com/?p=15966

here's last year

http://rolfpennerforcwb.com/2008/10/31/average-us-elevator-prices-vs-pool-returns/#more-814

Here's what this has cost western Canada over the last 5 years in spring wheat alone.

http://www.siemenssays.com/?p=15286

"I believe we are trying to sell wheat into a flat market."

Really? Are you sure? Because when I look at the April '09 US wheat associates supply and demand powerpoint presentation I get a different impression.

http://www.uswheat.org/USWPublicDocs.nsf/a280b21ba0e2ea9385256f3900554e60/5a2cc660478bba538525759e0066ba74/bodyContent/0.D60?OpenElement&FieldElemFormat=gif

Slide 8 is interesting, lowest beginning stocks since 1978.

Slide 9 shows a pretty tight stocks to use ratio, yes it's a bit higher than last year but still incredibly tight.

And slide 29 shows that Global imports have been steadily increasing over the long term and dramatically over the short.

Now lets pretend that the market was flat(it's not, but lets pretend)Where is the evidence of the wheat boards 'clout', it's 'marketing power' and it's awesome market share? It shouldn't matter if the market is up, down or flat, if the wheat board were a superior marketer it would be able to get us higher returns than average open market returns. Which it hasn't, board returns are always below the open market average.

"What impact of the credit crunch and the reluctance of buyers to forward price and take delivery had on both crops?"

For all intents and purposes I would think it would be pretty much the same. Yet canola is moving like crazy and board crops are behind.

"I put forward the deregulation of the Australian market resulted in an early flood of wheat on the market due to Australian grain companies seeking market share."

Could you put forth some actual evidence to support this? Or is this pure speculation on your part? I suspect it is the later.

"Production numbers alone do not make a valid argument." Says who? You? Do you really believe farmers grow more when there is less money on the table?

And lets take a look at Friday's closing new crop offerings.

In Manitoba, CWB Fixed Price Contract CWRS 13.5 = $6.25 CAD

Berthhold ND, new crop for off the combine delivery= $7.16 CAD (.8648)

http://www.bertholdfarmers.com/

That's 91 cents a bushel in favour of the open market for spring wheat. Now how's about winter wheat?

Manitoba, 1 CWRW = $4.79 CAD

Berthold, winter wheat = $5.89 CAD

A $1.10 per bushel towel slap in the nads for you board lovers.

"I am always amazed how individuals posting on Agriville state a position based on just one piece of data and then ignore everything else."

If you believe that you are so not paying attention dude. You also need to take a serious look in the mirror, and while you're at it, stop bringing speculations that you can't back up to a fact fight.

[Fransisco]

Oop's the link for the powerpoint didn't work. Try this one.

http://www.uswheat.org/supplyDemand/doc/5A2CC660478BBA538525759E0066BA74?OpenDocument#

[charliep]

More numbers. On week 40, there is about 4 mln tonnes of wheat in the commercial system
(CGC grain stats weekly).

To hit a 17 mln tonne export, they need to over about 4 mln tonnes of wheat over the next 3
months. You can add in about 750,000 of domestic milling use.

4 mln tonnes inventory to meet the needs of 4.75 mln tonnes of disappearance. Realize the
issues around multiple segregation on wheat but seems to highlight a problem. Canola has
1 mln tonnes of inventory in commercial position and uses 1 mln tonnes every month.

[dmlfarmer]

I am not claiming central planning is better. Those are your words Tom, not mine.

What I am disputing is the ongoing trend of most posters to build an argument around a single fact or commentary and refuse to even consider alternatives reasoning for events. Examples in this tread alone include: since the CWB is calling for wheat during spring they must be poor marketers, since all my canola is gone then all the canola in the country must be gone therefore the open market is superior,etc.

These statements are no more valid than if I would to say the open market is not working because based on statscan March 31 stats we had record high canola stocks in Canada and since wheat stocks were not at record numbers on March 31, the CWB is superior.
March 31 stocks in Canada Million tonnes
canola 2004-2.5, 05-3.7. 06-5.1, 07-4.8, 08-4.6, 09-5.9
wheat 2004-13.7, 05-15.3, 06-18.7, 07-16.0, 08-11.5, 09-15.5

It is stupid arguments such as found in this post in which debaters refuse to look at the entire supply - demand picture, in which arguments are based on commentary rather than fact, and which anything said by anyone is considered true and gospel if it supports your position in the debate (and if is disagrees with your position is not worth considering) which is dividing farmers. Instead of looking for ways in which we agree and can work together, most posters appear only interested in tearing down.

I was not arguing in support of the CWB, I was questioning the validity of the arguments being used trying to discredit the CWB.

[silverback]

There is only one word that should settle any argument over the "validity" of the cwb:

Freedom.

[TOM4CWB]

dmlfarmer,

You still don't get it!

The CWB has had for ever to plan. To expect growers to deliver during seeding... without compensation for extra costs; is unreasonable.

Non-boards pay up handsomly with a narrower basis if they need supply.

The CWB seems to be oblivious to the realities on our farms. That is a problem.

[Hopperbin]

I see nothing wrong with offering an extra 10 or 20 cents premium to get farmers to start hauling. Pays for the trucker. If the CWB is losing on the other end for non timely delivery then why not give the penalty to the farmer and make the delivery on time?

[Hopperbin]

You know with all their complicated non market orientated pricing schemes crap that they have they should at least figure out how to entice farmers to delivery grain. Well I guess we should know that the CWB does not negotiate with farmers. They tell us what to do.

[vagabonddreamer]

lol..vagabonddreamer laughs with and at dmlfarmer... sharp is the learning curve of the CWB and Agriville...(he states in his best Yoda voice)...

the polarization is astonishing on this issue...both sides stubbornly REFUSE to acknowledge that another opinion can or SHOULD exist....AANNNDDD..if you are NOT entirely FOR something...then you are ENTIRELY against it...lol...if you QUESTION a component of either side's argument then OBVIOUSLY you are against the ENTIRE thesis...

still to this point in the whole mix though...from an outside perspective..i still think that the "force is strong" with the anti CWB side...they do have logical business case numbers working in their favour...the pro CWB side is operating significantly on emotion and what MIGHT happen should the CWB become a voluntary organization...

both sides are passionate however...and it is in all honesty, wonderful to witness people in our bland-pablum-apathetic society...take arms against their own sea of trouble...vs

[dmlfarmer]

Amazing, absolutely amazing! If a private grain company had phoned and said "we have a delivery opportunity for a non board grain over the next few weeks and this is the price we are offering" I am willing to bet most farmers would have be thankful for the call. They would have respected the company to letting them know of the opportunity to deliver and been happy that the company personally called them with the opportunity. The farmer may not want to take up the offer or been able to deliver or may not have liked the price but to have the opportunity and personal invite would have been seen positively

However since it was the CWB that called suddenly this is being used as another example of poor marketing by the CWB. The hatred for the CWB is so deep many on this list cannot even realize that this call means the CWB has managed to make late season grain sales of a record Canadian wheat crop into a market which has just come off record world wheat production.

And then the ever present greed on the list raises its head. Well if the CWB would offer premimums we would not complain. We need more money to hire the trucks to deliver the grain. Yet many producers already have thier grain custom hauled. There actual delivery costs the farmer will incur for hauling now are likley similar this spring as they were a month ago, or the day it was -30 and the trucker showed up.

But, you add, the CWB had forever to plan. Well buyers had forever to buy. Back to my original point, buyers chose when they want to buy. If you grow it does not guarantee you will be able to sell it for the price you want - the Field of Dreams was fictional. There were a host of factors this past year that likely have kept buyers from building stocks as they normally do.

I do not care if you do not want to haul grain during spring. There are farmers that will be willing to and the CWB needs to get the word to these farmers of the opportunity to deliver.

I only wish you could set aside your hatred and greed long enough to see that this call for delivery means there is demand for Canadian wheat and if we can fill that demand there will be less carryover.