New Crop Feed Barley

[IAMTHEMOLE]

I think farmers should sell the s#$T out of Oct 08 barley. Our dollar is 1.07 today. You will need a hedge account to do so as I do not foresee many forward contracts out there. Remember Oct 08 barley price of 191/mt represents barley in Saskatoon. Do not miss this one!!

[charliep]

Agree with selling with caveat you need to hedge using futures and be prepared to top up your margin account if prices go higher. Not forecasting the future at this point but rather looking at $4/bu plus feed barley relative to history, profitability, cash flow next fall, etc.

I also asked the question on acres because I suspect feed barley acres will increase next year in Alberta. Clubroot in canola. $5 to $5.50/bu CWRS (other classes closer to $5). Also cannot guarantee the pricing opportunities will be there in world markets. Finally, the size of the cattle herd and pig numbers will decline. All point to lower prices but mother nature will be the driver given tight world carryovers.

[TOM4CWB]

Charlie,

I see on wheat the 31 of Oct/07 the CWB has the basis@ $12.89 Dec and $14.81 under on March 08.

What tells you the CWB will be at $10 over in 08?

What is this deduction, it can't be a basis driven by market values at port position... It looks like another adjustment factor to assure the poolers, that flat pricers learn a lesson!

I learnt a lesson... doing a futures only and expecting a market driven fair basis from the CWB is totally unrealistic. Until there is major management revolution at 423 Main.... FPC and PPO contracts are taxes to milk flat worlders!

[charliep]

Just a WAG (Wild A***d Guess) based on where the CWB has set basis in the past. I use the $240 converted MGE plus $10 minus $50 for CWB deductions for a local price of $200/tonne (about $5.45/bu). Don't have any idea as to where the CWB will other than history.