Today's big news surrounding barley is not about anything the CWB has done. Really. It's about what the CWB refuses to do.
Agricore United has begun posting an international feed barley price, representing what the company would pay farmers in a marketing choice environment. The price was posted at C$233.70/tonne, basis Vancouver. The board's latest Pool Return Outlook for the B Pool on feed barley gives a price of $190/tonne, also basis Vancouver. The Board acknowledges that the higher price is out there, but refuses to offer it to farmers.
Now, the Board can't use the excuse that it had made lower priced sales earlier in the year - there are two pooling periods for feed barley, with the B Pool running from February 1 to July 31. It can't say that the bottom is likely to fall out of the feed market. According to the CWB's PRO announcement from Thursday, "Global feed grain prices are expected to receive support from the U.S. corn market well into 2007, with U.S. corn ending stocks expected to be at the lowest level since 1995-96." If that is the case, why the huge disparity between sales that can be made now, today, at this moment, and the price it says it can deliver to farmers? Why not attract grain to the B Pool to meet this demand? A cynic might say that the Board just wants to make sure that its feed price stays below its malt price. The Board does not want to admit that it hasn't done the best job of marketing farmers barley. But we already know that; the evidence is plain as day.
The board has cultivated its image as a protector of Canadian farmers. If this is protection, being 'sheltered' from high prices, then count me out.
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Hey you two young farmers discussing the "politics" of grain....thanks for shining a spotlight on the antics of the political stooges that insist on costly interference in the serious business of grain farming.
But don't sell yourself short. Your solid economics is also coming through loud and clear, and I appeciate you bringing some transparency to the otherwise murky view with respect to Canadian barley prices.
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