August CWB Pool Return Outlook Released

[charliep]

Will start the thread with the press release:

Quote: "Pool Return Outlooks
2007-08 crop year
DATE: August 13, 2007
CWB 2007-08 Barley PROs Released
Winnipeg -- The CWB today resumed publication of its Pool Return Outlook (PRO) for designated and feed barley in the 2007-08 crop year. Barley markets have strengthened since spring 2007, with crop production problems in Europe, recent intense heat in Western Canada and the quality and quantity of the Australian barley crop still unknown. The strengthening Canadian dollar and record ocean freight rates are offsetting bullish markets."

Will be following the impact of the above on the fixed price contract basis/adjustment factor and the early payment option premiums. Know this stuff is really boring and perhaps a waste time at harvest time but they reflect the guts of how the program operates. I will express my extreme frustration where a program has such extreme variations around fixed dates versus contracts that would change to reflect market conditions and provide necessary signals around logistics and other factors.

[charliep]

Will leave the review/just see if someone asks questions.

Highlights: 80 and 90 % EPO payments have increased with the higher PRO but premiums have not gone. 100 % EPO are slightly but not as much as the higher payment. Hopefully no one complains about the low initial payments - just suck it up and pay the $2 to $4/tonne premium for an 80 % EPO.

Not big changes fpc basis/adjustment for CWRS, CWES, CPS and CWRW. SWS took a $10/tonne set of pain in terms of weaker basis. Malt barley basis (2 row anyway) strenghthened by $10/tonne. Feed barley basis strenghthened as well. The discount to the PRO increased by about $2/tonne for durum.

Not too much to say except the observation (as others have made) that significant changes in PPO values/premiums do occur around PRO (today is no different). Perhaps a challenge to the CWB is to have market based solutions that change daily to reflects markets versus administered ones that fit time tables.