Anybody pricing?

[Wheatking]

Burbert
Burbert you are right. Are where was your god damned board to
protect farmers. If they cant or wont help the farmer get the
hell out of the way. At least now there should be some
accountability with what happens in the malt industry. There are
only two people who can be at fault now, no passing the buck
anymore. If we have a disagreement on malt the tests go to a
third independent party for final results. And if we still have
a disagreement everything is in writing and we can get the
courts involved or take our business elsewhere.

I really hope that now the board is gone our customers(maltsers)
can be treated as our partners and not our enemies which seems
to be the board and the small minded way.

[farmaholic]

Re: what Burbert is trying to explain. If anyone thinks what he is saying can't or won't happen, they are only fooling themselves. This is not a pessimistic view just a realistic view. Your customer is always right, even when they are wrong. Don't forget who is making out the cheque.

[FarmRanger]

Hopperbin, only protien germ and plumpness. No
bags, just air floor bins.
Had over 1% wheat in 2011 (even with clean
canola last year and wheat 2 years ago!!), but
they still accepted it. It was pleasant to deal with
someone who actually tried to make the deal work
anyway.

[blackpowder]

Farmranger; would you mind saying what region you're in roughly??
It would help me get an idea if my price offering is fair given freight.
Talked to Malteurop rep from GFalls at a meeting, but my freight would make price same as my local CMalt.
Curious as to your buyer but of course thats your business.

[blackpowder]

I well remember what Burbert is talking about. Even now the contracts we are signing are legal ass wipe.
A reasonably clear hedging method for both partys would help. And I have to think at least now it has a chance to develop.
Someday hope to see a malt contract as airtight as a canola one. That may be the only way to clean the companys up?

[FarmRanger]

Lethbridge area. I think there are limited tonnes. I renewed a while back for the same tonnes as last year, but unfortunately couldn't increase it any. Freight is quite a bit for me too, but still beats what I'd make from what the Canadian Maltsters have been offering.

[blackpowder]

Our 'Act of God' is on first 20 bu. only. After that $75/t penalty for non delivery.

[FarmRanger]

That doesn't sound right? Are you sure the non-
delivery isn't on the 1st 20 bushels you produce?
At any rate, it still sucks if the quality isn't there at
harvest time. I wouldn't sign that contract
blackpowder; at least not very many bushels,
unless there was one heck of a premium for doing
so, but that's just me.

[Wheatking]

Blackpowder. I assume you are talking about the contract through
Canada Malt. The $75 is the penalty if you price anything over
the AOG and fail to deliver. The guy at Canada malt told me that
they hope to never charge that $75/tonne penalty if a person pays
the difference in malt prices(but I take that with a grain of
salt). Which is still an unreasonable penalty IMO. But they do
base there contracts off the MGE dec wheat futures so with them it
is possible to hedge the grain without pricing it through them.
The big problem with this set up is that the wheat futures are
only very loosely correlated to malt prices, but at least there is
some mechanism to hedge your price, without pricing it through
them and still being guaranteeing delivery.

So the long and short of it is that these contracts are far from
perfect but are better than what we have had in the past, IMO.
But that being said I only sighed up a couple hundred acres to
test the waters. I might also add one of the benefits that I
liked about going through them is that they let you sign up barley
other than metcalfe, namely Meredith, Newdale and Copeland, all of
which give you at least a 10 bu/acre yield boost with out the
disease.

[blackpowder]

Assumptions correct.
It's still a shell game for us, but I believe a little clearer and will further improve.
Properly hedging risk has been difficult for both partys. Should that get better these BS contracts will disappear.