While every other commodity outside of the wheat boards control can be priced by farmers year round the board only offers basis contracts from now until the end of October. It did offer futures only contracts prior to this but since you couldn’t lock in a basis level you had no idea what your final price would be.
For your readers who have asked this question before – ‘basis’ is the difference between the futures market price and the actual in your pocket cash price and as such is very important. For board grains one also needs to subtract the standard CWB deductions back to their location to get your final price.
So here we are in the hottest wheat market ever and the CWB response is to give producers who want to price their grain into this rally the worst basis they have ever offered. Every other year it started as a positive, this year its a negative $29.10/tonne. And to top it all off this year you have less opportunity than ever to pull the trigger as the board will only be taking orders from 3pm until 9pm, they are no longer taking them in the morning before the market opens.
Its the CWB version of competition and choice, they can’t even successfully compete against themselves and while they talk about offering more choice you actually get less. We need real choice on the prairies and real competition and we need them like Britney Spears needs Fruit of the Loom.
uh, Britney needs Fruit of the Loom? ???
This is fantastic news . . . the Wheat Board is so good for Western farmers I am sure Steffi will impose it on the rest of Canada.
It only fair after all.
like gormley said yesterday….don’t complain we voted for the CWB.
none of which has any relation to (daily) $32.40 price swings on the MGEX for September/December wheat? Or that front month was up $200 a tonne a day ago and down (at this moment $120 from that high??
That sounds like the “very stable” market that always results in a “very stable” positive basis doesn’t it??
There is one thing your post doesn’t tell us… What is the basis price an American producer can lock in for September delivery?… I wonder why.
The actual performance of the CWB is moot. The entire issue revolves around the freedom of farmers to do with their produce as they wish. Forced sales to the CWB strikes at the very root of Canadians’ freedom.
This should not even be subject to a vote by wheat farmers, any more than I consider my right of freedom of speech to be subject to a vote.
Rabbit, I feel the same way about healthcare,… and hundreds of other social programs where my money is taken and spent without my consent.
What is the difference between all of those and the CWB??
This is the jackbooted state thugs punishing farmers for daring to question their supremacy over the farmer’s lives.
Can you people stay on topic? We already know the CWB is a yoke on farmers. The debate is about whether or not Britney needs Fruit of the Loom
Look here for that American basis.
http://bottineaufarmers.com/index.cfm?show=11&mid=6&theLocation=1&cmid=1&layout=1
-70 cents per bushel for September in Bottineau North Dakota.
Now don’t forget if you want to do an apples to apples comparison that you have to back off that standard CWB deduction to Manitoba which is $55.32 per tonne. So in total you have to subtract $84.42 per tonne or $2.30 per bushel to get the Manitoba CWB price.
I didn’t factor in the exchange rate here but even so the Americans with there open market competitive system have a much, much lower basis level than Canadian farmers. Go figure.
And the difference between health care and the CWB is that Canadians are free to access health care anywhere else in the world, farmers on the other hand are not free to sell board grains outside of Canada.
We have more freedom to access health care than we do to sell our wheat and barley.
Hmm, my answer to Barcs on American basis levels seems to have gotten tagged for approval before it will get posted.
Suffice it to say that their levels are way, way more competitive than the CWB.
the CWB is a communist organization – literally, the CWB is run by a group of marxists – when does the revolution against these bureaucrats start because I want to participate?
Bring forward a bill in Parliament to scrap the CWB and make it a matter of confidence.
See how the Liberals squirm out of that one!
clair voyant, they better do it before Oct 2009.
This is exactly what is wrong with Canada. Whiny Marxist fishermen and Third Way Socialist farmers with a hate on for a free market economy setting financial and economic policy.
Let them stew in their own soup for a while and in the meantime why dont all of you free enterprisers (if there are any) and farmers who think like free men, sell your product to whoever and wherever you want. The Government be damned!
Or maybe your just too scared?
You are right Rolf….. We can access it anywhere. so long as we pay for it here before we go anywhere to access and pay for it again.
-70c a bushel… $26/tonne. CWB is $29 a tonne.
Sounds not bad except you are right the CWB doesn’t include shipping and elevation in the basis like the states do.
But maybe you could answer another question for me… If the States charge $26/tonne for cleaning/elevation and shipping…. Why then do we have this: standard CWB deduction to Manitoba which is $55.32 per tonne.
It is in fact not a standard CWB deduction… but a Standard Railway/grain company deduction.
Shipping (discounted for a 50 car slot) is almost $40 a tonne… that’s railways. but in the states is is $26 for cleaning elevation and shipping.
Cleaning and elevation is $17.45 at my elevator. which is 2/3 of the American $26/tonne.
So tell me when the standard backing off is $57 to here… and only $26 just south of me…. Is it just the CWB that is screwing me? or maybe there is some companys that are still screwing me worse than the CWB.
No doubt you have been just as vocal against them as you are against the CWB in earlier posts here.
Oh.
maybe some of the difference is in the government handouts the US farmers get that we don’t
The Mississippi waterway for one example. Is a military priority (who knows why in this day and age) and is maintained as such by military money. Shipping.. and especially grain shipping contributes very little to the maintenance of the waterway.
Why haven’t you been railing against such subsidys applied to their grain? Or the higher chemical/fertilizer prices?
Because destroying one of the few things that brings stability to our prices is more important than leveling the playing field so that we can compete on that level field??
Insiders smell the end coming and are raping the system before it’s closed…when/if Harper comes out from under his desk to fulfill this election promise, he should also have a forensic audit og CWB operations for the past decade and make the profiteering insiders pay back what they have stolen from producers and the public in taxes.
(Barcs, 5:40 pm)
> The Mississippi waterway for one example. Is a military priority (who knows why in this day and age) and is maintained as such by military money.
The US Army Corps of Engineers (USACE) is in control of all inland waterways, for navigation, power generation, and flood control. This has always been seen as a matter of national security.
Their motto: Relevant, Ready, Responsive, Reliable.
You’re right on one thing: grain shipment is a minor consideration, in light of all their other tasks.
I’ll try to do this without the actual web addresses so as not to get trapped in the filter again.
Lets take a look at some numbers from the federal grain monitor.
Barcs do a Google search for “Quorum Corporation” then go to reports, select the 05-06 data tables, go to page 148 of the pdf and you will see that for spring wheat the total export basis was $59.64 when shipping it from Manitoba east in 05-06.
Then go to page 149 and you will see that it was $63.34 for durum.
Then on page 150 you will find canola coming in at $37.06
Now isn’t it interesting how much cheaper it is to move free market canola than it is to move CWB grains. $22.58 to $26.28 per tonne cheaper.
So it doesn’t matter if you compare the cost of shipping board grains to open market grains in either Canada or the United States they keep coming in last in the competitiveness department.
This is a real cost to Western Canadian farmers.
You are right when you say the playing field isn’t level, it is the CWB that is tilting it in the wrong direction. It’s one thing for a foreign government to be working against us it is another thing entirely when it is our own government policy that is shooting our own farmers in the foot and making us uncompetitive.
By the way no one is talking about destroying the CWB, just making it voluntary. It will be free to offer you the same(low)stable prices that it always has.
I see it like everyone here and I agree with WLM Redux. They are milking it presumably because no one could be so obtuse or let’s say for the benefit of the doubt, incompetetent, to mess things up this badly at the CWB. They are definitely not securing their future in this way and it’s plainly obvious that under these circumstances producer support will erode further.
I think that the government will win it’s case in the court of appeal that a government order can decide protocol of the CWB and an act of parliament is not required. When and if they win, then I would hope the government acts quickly to completely end the monopoly across the board. I think the CWB insiders must be aware that this will be the outcome, at any rate they seem to act that way.
Government loses court battle to crack barley monopoly:
http://www.cbc.ca/canada/manitoba/story/2008/02/26/wheat-board.html
Wow Iberia thanks for the link on that. At the CBC it went up 4 minutes before my post, which makes it very fresh.
In some respect this can be considered interesting rather than just terrible news. Most of us here dislike the CWB premise, as anyone respectful of equality and human rights would be. I can’t see the Liberals exposing their jugulars by attempting to hinder a parliamentary vote on this. After all, the optics of their supporting such an unfair and antediluvian system would be altogether too ugly, even for them (one can only hope I am speculating correctly, of course).
“By the way no one is talking about destroying the CWB, just making it voluntary”
To me that definition is the same. And you witnessed it in barley this year.
As far as barley goes I could care less whether the board runs it or not. But the price problems we had in the fall were largely do to instability. The CWB couldn’t make any sales cus they didn’t have the rights to the grain. And neither could we…. for the same reason.
Voluntary introduces much of the same volatility. The CWB under that condition is no different and for a couple years while they adapt to the new environment and conditions they become a very unstable company.
That defeats the purpose my farm uses the board for (stability).
Under those conditions it is not a stable option…. Read that: Not an option.
Wheat is another matter. MY choice of delivery points (I drive past the useless Sask Wheat Pool elevator) is one of the independent (51% atleat) farmer owned. When they export, And wheat in Canada is largely exported. Every tonne, every bushel, every pound or kilogram goes over the competitions scales at port. But for the grace of competition agreements and the CWB they are able to export.
What happens without the CWB assigning cars and shipping? When the bigger companies even the one they are partnered with decide they would like to compete in our area? maybe own another elevator? Better be on good terms with several of the 5 or so companies that have terminal space at port. cus if you get down to 1 or 2 it would be a simple matter to shut down your shipping and export until you sell out. Ship through the states? good luck. It is hard enough to get a sample of yellow mustard (a crop which they want) across the border to a buyer let alone the thousands of carloads of wheat that even a small terminal runs though.
Summary: Who cares about barley… as long as the fighting stops either market could be useful and probably not much different. Wheat is a little more important if I don’t wanna double my trucking distance (and lose the investment in the elevator).
You see my problem with the shipping/elevation prices Rolf…
Why are they different between wheat and canola??
It’s my understanding that its the Railways dealing with the government when they set the prices for board grains. Not the CWB.
Am I wrong?
make it a double play – at first and then at home.
hrc/cwb – yerrrrr out! batter up.
and cbc looks around at the crowd a little bit anxiously.
Barc,
All you have said leaves out the most important consideration:
Why the fCK do you think you have the RIGHT to DEMAND that all the other farmers who do not agree with you use a state-owned and mandated monopoly without recourse?
What gives jackbooted tyrants like you the right to FORCE your opinion on everyone else?
Just who do you think you are?
I am the same guy that has his money stolen for the “greater good”…. education, healthcare, welfare, EI, infrastructure… etc etc.
Some benefit me to some extent to be sure, but nearly always not to the extent in which I am (forced) to contribute.
Why does such “greater good” include only things that benefit others? Where is the “greater good” things that benefit me more than you/them?
You give up your “right” to my resources and I a will gladly do the same for you and your resources.
Barcs,
“You give up your “right” to my resources and I a will gladly do the same for you and your resources.”
Deal. Especially as I never claimed a right over anything of yours.
I want the minimum possible government. Period.
I want the government to run jails, defend the state, pave the roads and that’s just about it.
Don’t use the state’s intrusion into one area as an excuse for more of the same.
Barcs is a true Socialist. As such, he and his pals, know what is best for everyone else. Just ask him.
Well Barcs
The difference between the cwb and heathcare is this.
Health care is universal across canada.
the cwb on the other hand, is only forced on western canadian farmers.
Go to the cwb site and read it for yourself!
The NISA point of sale guidelines were also never changed by parliment and the Federal Court continues to try and have the case tossed out. Any case that may benefit the farmers which are the same does not seem to matter. The courts just rule against the farmers benefitting with the help of the lawyers.