USDA average weighted prices

[Fransisco]

The main reason I am ticked off at the removal of the 'Vader' thread is that last night I did a rather detailed post on the USDA average weighted prices which got deleted along with everything else.

So, I'm going to redo it here on a thread of its own.

[Fransisco]

First up the claim, which can be found

http://www.canada.com/reginaleaderpost/news/letters/story.html?id=d391d097-d57b-483b-8c96-ef34280919a7

<blockquote>Ken Ritter, "U.S. Department of Agriculture statistics clearly show that western Canadian farmers are getting better returns than their cross-border counterparts. Comparing No. 1 CWRS 13.5 to DNS 14, the weighted average of the price received by North Dakota farmers in this crop year is $6.79 US per bushel, and the average received by Montana producers is $6.84 US. I'd rather receive the February PRO of $9 US per bushel, backed off to the farmgate in Saskatchewan."<blockquote>

here

http://www.familyfarmers.com/beingessner_paul.htm

<blockquote> Paul Beingessner, " the average price actually received by farmers in North Dakota to date has been $6.50 a bushel."<blockquote>

-Note to Agriville management, this is not copyright infringement it falls into the category of fair use.-

And lets not forget Rod/Vaders post here

http://agriville.com/cgi-bin/forums/viewThread.cgi?1206116026

<blockquote>Rod/Vader, "The reported weighted average selling prices for North Dakota farmers is $6.50 for DNS 14..."<blockquote>

[Fransisco]

Oop's sorry about that, goofed on some code there.

[Fransisco]

So to recap the claim is, supposedly the weighted average price North Dakota farmers received for #1 DNS 14 in 2007 is either $6.50 or $6.79 depending on which CWB source you want to take.

[Fransisco]

Here is how you double check to see what the real weighted average price is.

First you go to the following webpage

http://www.nass.usda.gov/Data_and_Statistics/Quick_Stats/index.asp

In the first drop down menu choose "US & State, crops" and hit go.

Then in Step 1 choose, "Planted, Harvested, Yield, Production, Price (MYA)Value of Production"

Step 2 choose, "Wheat Other Spring"

If you choose Hard Red Spring you won't get any data the reason why is that they put it in the "Wheat Other Spring" category. I called USDA NASS and that is what they told me.

Step 3 choose the years, (2006 is real interesting)

Step 4 choose your states "North Dakota and Montana" use the add button to do this.

Final step hit the "get data" button at the bottom and viola you get your prices.

[Fransisco]

And what wondrous prices do appear?

For 2007 North Dakota <b>$7.30</b> per bushel and Montana <b>$7.60</b>

But hey what's some 80 odd cents a bushel between friends right?

And get this, while this is based on actual sales, since the crop year isn't done yet, the USDA also uses a calculation that was done in February to estimate what the final number might be.

So Ritter and Flaman et al are trying to compare two moving targets for 2007 the PRO and the USDA weighted average price. We won't know the final hard numbers on any of this for months, and by then we'll be arguing over the 2008 crop prices. Very convenient, I'd say.

Wait, it gets even better.

While the annual season-average price for all five classes of wheat(spring,soft red winter, hard red winter, white and durum) are based on monthly prices received by farmers weighted by monthly marketing's. They are not segregated according to quality.

I talked to two different USDA NASS people at two different times and they both told me that they do not separate out the various grades and protein levels for spring wheat and they do not have the ability to do so. It is all combined together into one number. That number is a real mixed bag that includes all premiums, discounts and contracts across all quality levels including feed.

So when Ritter and Vader talk about it being #1 14% protein DNS they are wrong. Maybe this is deliberate, maybe they just didn't do their home work, maybe its a little of both. Who knows.

[Fransisco]

Now what was so special about those 2006 prices you ask? Good Question.

The USDA weighted average price for Red Spring in North Dakota was <b>$4.49</b> USD per bushel, Montana's was <b>$4.58</b>

Head on over to this page here for the final pool prices.

http://www.cwb.ca/dom/db/contracts/pool_return/pro.nsf/WebPRPub/2006_20070927.html?OpenDocument&CropYr=2006-07

It's a little hard not to notice that even if you just take the very best Hard Red Spring prices for that 14.5% protein level wheat, the board couldn't beat the catch all, grab bag, everything including the kitchen sink, weighted US price.

Is this really what you guys want to be comparing yourselves to? Really?

[Fransisco]

For those of you who don't want to bother looking it up the final in your pocket pool price for #1 CWRS 14.5 in Manitoba was <b>$4.40</b>, Saskatchewan was <b>$4.32</b>

[Fransisco]

Spot price... nope can't beat those.

Simple average of spot prices... nope can't beat those.

Weighted average prices... maybe, sometimes, but in 2006 they sure handed the board its butt back to it on a silver platter.

[LWeber]

http://www.bank-banque-canada.ca/cgi-bin/famecgi_fdps

Average 01/08/2006 — 31/07/2007 1.1258 CAD[ 0.8883 USD ]