"Contract squeeze worries farmers " is the WP headline

[TOM4CWB]

Or we could just let the onus be on the buyer to buy and pay for all of this???? But no can’t do that
It would be too simple and too much less stress on the farmer.

On AOG contracts the Canola buyer just may be doing something like this…

On Pulse AOG contract there is no futures on the pulses, so the most likely insurance that can be bought is rainfall insurance… which might pay back 1 year in 20.

Many Pulse buyers do back to back sales to an end user, who then takes the risk on the AOG … perhaps Bunge can do this as well on the Nexera specialty oil sales, as they would seldom actually need to exercise the AOG on 10bu/ac for the main contact months, it was only in MarchApril that the 25bu/ac AOG was available for June July August 2022 production contract deliveries.

No free ride for anyone.
Cheers!

[the big wheel]

And how much would you like to pay for that? You would never know. You can do it cheaper.

I think those people hammered by an unusual drought would
Not like to pay 8 to 1 bucks a bushel to get out of
A contract if they have no grain.

[blackpowder]

World wide commodity markets actually seem to function rather well. Chaos without them.
What you are suggesting is a risk free delivery contract option.
I am asking what you think that would cost you off the top for the buyer to do it?
Hedge able commodities only of course, you are asking everyone else in the world to function within an open outcry environment to discover price and off load risk. You will pay a premium to your obligation holder for that.
You will pay it at default or within the basis at signing. I suspect the difference high enough no one would sign one.
Too bad the CWB's books aren't available for an answer.

[farmboy44]

I think those people hammered by an unusual drought would
Not like to pay 8 to 1 bucks a bushel to get out of
A contract if they have no grain.

the opportunity for something like what’s happening this year necessitated a 8-10 price appreciation from November to April. Even though things are much more volatile these days, I feel like that won’t happen very often.

But really, we could be having the same conversation over a 3 dollar buyout per bushel to.

[TOM4CWB]

I think those people hammered by an unusual drought would
Not like to pay 8 to 1 bucks a bushel to get out of
A contract if they have no grain.

Interesting question on what we should pay or are paying…

$20/ac straight hail insurance
$25/Ac crop insurance premiums,
Hedge costs 5/ac so far;

That is close to $1/bu insurance costs on our Canola.

Not cheap but covers $700/ac Revenue which is possibly the best ever…

Once in a lifetime return possible!
Cheers

[blackpowder]

So you're selling 50 @ $14??

[furrowtickler]

Interesting question on what we should pay or are paying…

$20/ac straight hail insurance
$25/Ac crop insurance premiums,
Hedge costs 5/ac so far;

That is close to $1/bu insurance costs on our Canola.

Not cheap but covers $700/ac Revenue which is possibly the best ever…

Once in a lifetime return possible!
Cheers

Depends totally on your average yields
And swing in yields that happen in some areas , some years 30 bus , some 50 ish ... in this area anyway

[TOM4CWB]

So you're selling 50 @ $14??

Black powder it really will be a huge surprise if we make 70% of our Canola crop insurance coverage on average between EDMONTON and Flagstaff.

50bu/ac would be an astonishing miracle unlikely to happen, 17bu/ac flat priced. Rest expected covered in Commodity Account to 60%.

Cheers

[TOM4CWB]

Don’t worry, a couple more lean years around the globe and you won’t have to worry about contracts or what price you get for your commodity. The government will take control and you will get the amount deemed correct. Sound communist, you got it.
Don’t laugh, a starving public would make for some extreme policies.
Highly unlikely but not impossible.

Jwab,
Perhaps that will come with the Davos’reset’ wiping out all government debt… but not ours of course…

All so we can ‘save’ ourselves from climate change… which is all our fault of course… especially North Americans…

Saw province in China got 200mm in one hour… perhaps they shouldn’t hog all the rain!!!

Cheers

[sumdumguy]

I just put myself in the buyer’s position. I have signed a production contract with Joe Blow then checked out logistics, currency, boats etc.found a buyer for my shipload in Burma. Then oh darn a drought reduces production, price of Canola doubles and producer comes in saying he’s going to deliver none because he is writing the field off. Now what?

[furrowtickler]

I just put myself in the buyer’s position. I have signed a production contract with Joe Blow then checked out logistics, currency, boats etc.found a buyer for my shipload in Burma. Then oh darn a drought reduces production, price of Canola doubles and producer comes in saying he’s going to deliver none because he is writing the field off. Now what?

Are they not protected from that scenario ?
It seems importing countries cancel contracts on a whim sometimes, like China . There must be a protection system in place on one end or the other ?

[TOM4CWB]

I just put myself in the buyer’s position. I have signed a production contract with Joe Blow then checked out logistics, currency, boats etc.found a buyer for my shipload in Burma. Then oh darn a drought reduces production, price of Canola doubles and producer comes in saying he’s going to deliver none because he is writing the field off. Now what?

Hopefully that grower is in Alberta and has crop insurance… it has folded into it the variable price feature that provides the grower with compensation equal to the average Daly October 2021 prices, which should look after the problem, if you were careful who you bought your Canola from!

Cheers

[Sodbuster]

Hopefully that grower is in Alberta and has crop insurance… it has folded into it the variable price feature that provides the grower with compensation equal to the average Daly October 2021 prices, which should look after the problem, if you were careful who you bought your Canola from!

Cheers

You farmer’s in Alberta have a great crop insurance program compared to Saskatchewan where here they set price in February and usually low ball the price to boot. Wish our government would do the same but would sooner spend 4 billion for a few elite farmers + $40/ acre for the next 5 years and more money to the oil sector rather than investing in all farmers. Taking a page out of Buckets book.

[bucket]

You farmer’s in Alberta have a great crop insurance program compared to Saskatchewan where here they set price in February and usually low ball the price to boot. Wish our government would do the same but would sooner spend 4 billion for a few elite farmers + $40/ acre for the next 5 years and more money to the oil sector rather than investing in all farmers. Taking a page out of Buckets book.

That 5 year term won't end and the 40 bucks an acre will go up..

Ask your MLA what the phuck is going on.

Chances are they can't or won't.

[LEP]

I have some contracted grain and have no problem with paying the differential in price if need be. It is the f uckage factor I have a problem with.

For example we were hauling lentils to Viterra, farmboy44’s employer on a .25 cent contract, with spot price at .23. So I am about 11 tonnes short. They say oh you need to pay .27 if you are short. Excuse me but your spot price is .23 and the trucks are lined up a quarter mile waiting to dump. Nope if you are short it’s.27. So I find someone with overage who was offered .23 to deliver on my .25.

It has happened more than once over the years.

Pretty much the same as setting grade discounts at the time of delivery. Never works in the farmer’s favour. Need a contract that is closer to Australia’s.