the one that started it all

[jensend]

at least as far as ag commodities go.

http://www.theglobeandmail.com/report-on-business/surge-in-cotton-production-drops-record-prices/article1960562/

[Happytrails]

Jen you have got to throw you lot it with the open market. Allow market forces to allocate scarce resources and match the commodities supplies with demands. The alternative is central planning which has a poor record IMHO. Of course there is no perfect open market but market forces are so strong that they will always prevail eventually. Our supply of food is too important to allow it to be controlled by anything else. Cheers, HT

[TOM4CWB]

HappyTrails,

All too true.

As a wise fellow said last week:

"In any government system... you should expect 30-40% loss to uncompetitive government inefficiency."

Which is exactly why the CWB Monopoly clearly has lost 'designated area' growers of wheat and barley much more than it can possibly gain.

Central planning in Russia... Eastern Europe, even China... fails to endure the test of time.

Canada is no different. In an atmosphere of chaos and natural disasters... the last folks that have effectively managed these challenges... other than pointing fingers... are paid bureaucrats.

[jensend]

gets sillier every day. the point of the post was that the price of cotton is expected to fall by 50% by the end of the year because production responded to price so quickly. pretty sure it didn't have anything to do with the cwb but if tom isn't judicious with his meds who knows where this will end up.

[TOM4CWB]

Jensend,

The CWB says they can control all that... without market forces... hold back supply when the price is high... to cause it to spike even more... yet higher... all because of the CWB single desk.

I truly hope you can actually see the connection.

When the rest of the world... sees high wheat prices... what do they do jensend?

THEY GROW MORE WHEAT.

So... us fools stuck with carry over wheat and durum... that just dropped by 30-50%... BECAUSE of the single desk... OUR SHIP IS SUNK!

The folks with one or 2 quarters of wheat/Durum... found some way to get it delivered through multi permitbooks etc... so they had no inventory to take a bath on.

So... PLEASE TELL ME WHY THERE IS NO CONNECTION HERE jensend!

[jensend]

uh maybe because the whole article is about the market for cotton and makes no reference, implied or otherwise, to marketing boards, including the cwb. i posted it to show how quickly production can respond to prices. im guessing you've somehow implicated the wheat board in the gold market as well. elucidate if you please.

[Happytrails]

To be fair the article does point out that growing more cotton reduces production of other crops. Tom and I came up with the idea that the board distorts market signals on our own.

[TOM4CWB]

OK Jensend... I bite:

If this were to be only about cotton... with NO parallels or lessons to be drawn for Canadian Agriculture...

Since we do not grow one pound of cotton... what have I missed here?

Supply Management?

Potatoes?

Sugar Beets?

Dry Beans?

Lentils?

Corn or Soy?

Since looking for answers for this question takes my small mind... to the grain storage bins we have...and back... What got you started here with cotton?

What did cotton start?

Fill me in... what did I miss???

[jensend]

evidently you missed a lot but maybe no more than usual. cotton was one of the first ag commodities to start this last price runup. now acres have increased by 14% and prices are forecast to drop by 50% but still be 2/3 above historical averages. so production responded to price and you can get some idea of the elasticity of price from the movement against increased supply. nothing to do with marketing boards or any of your other not-so-magnificent obsessions. read the article for what it says. i posted it as an indication of what can happen to grain prices if a decent world crop is grown.

[gregpet]

Sorta like durum? Thanks for the eye opener, but we have experienced this first hand already.