With an Oct. 31 sign-up deadline rapidly approaching, the CWB is encouraging farmers to commit wheat, durum, barley and canola to the wheat board’s 2012-13 harvest pool.
But grain growers in some parts of Western Canada say they are still having difficulty delivering wheat board grain, an issue that was not entirely unexpected, according to CWB officials.
With major grain companies still refusing to accept CWB grain in some areas, producers said uncertainty surrounding delivery opportunities is affecting their decision to participate in CWB pools.
“I’ve got three elevators within a couple of hours of me … and every one of them has told me that they have no plans to take any wheat board grain at all,” said a farmer from Youngstown, Alta., one of roughly 3,000 prairie grain growers who participated in an Oct 17 conference call with CWB executives.
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“That’s why I didn’t sign an early delivery contract,” the grower added.
“It would be nice to have some insurance that you could deliver this grain before you sign a contract.”
Grain buyers across the West are offering a variety reasons when asked why they are not accepting CWB grain.
Some elevators are busy filling non-board sales contracts. Others say they don’t have rail cars to accommodate CWB deliveries. And some say they are still waiting to learn what they should charge for handling and transporting CWB grains to port, a cost commonly referred to as basis.
“They’re all saying the same thing,” the Alberta grower said.
“We’ve got lots of sales for our own grain so why would we take wheat board grain in when we don’t have any rail cars for it right now.
“(They’re) not going to plug up (their) elevators with wheat board grain when (they) can buy straight off-board grain and it’s gone.”
Gord Flaten, vice-president of grain procurement with CWB, said board officials are aware of delivery issues and are working with grain handling companies to ensure that farmers across the Prairies have reasonable delivery opportunities.
He stressed, however, that both the CWB and grain handling companies are operating in a new environment and are learning as they go.
“There certainly were issues earlier on when they (elevator companies), were trying to clear out old crop supplies,” Flaten said.
“They also, quite rightly, are saying that they don’t want to bring in grain well before they know they’re going to move it, and that’s certainly fair. But we are in constant contact with those companies. They are telling us what supplies they expect to have and we are telling them what sales we have.”
Another producer from Marsden, Sask., raised similar delivery concerns, suggesting that local elevators have yet to determine handling and transportation costs for CWB grain.
“I looked at selling … a few loads on the board at both Viterra and Pioneer and they both said there was no basis available,” the caller said.
“They also said they weren’t going to be storing any board grain until they know that it can go out the door…. As far as delivery is concerned, if you can’t deliver, it’s pretty hard to put any loads on the board.”
Flaten said concerns pertaining to basis costs are being addressed.
“We’ve heard that comment about basis several times from a number of local elevator staff and I think that’s one of the challenges that the (elevator) companies are having getting information out to the country level,” he said.
“The fact is that the CWB does not set the basis… the companies themselves decide what those charges are going to be.”
“Many of these facilities have really just recently gotten up to speed on how to deal with these contracts,” he added.
Both Flaten and CWB president Ian White stressed that CWB pools offer a great deal of flexibility to producers in terms of delivery opportunities, the quality and grade of grain being delivered, protein payments and the producer’s ability to alter the terms of a contract without financial penalty.
In theory, producers who sign CWB contracts can deliver their grain to any of the major elevator companies operating in Western Canada.
If producers are having trouble making delivery arrangements with one company, they should contact another company and compare delivery opportunities and basis costs.
“I would encourage (farmers) to just keep going back to those companies or checking with some others to see what sort … of deal they are willing to do,” said Flaten.
“The other thing that I do want to stress is that just like every other year in the past, we can’t move the entire crop right after harvest so not everybody is going to be able to deliver in September or October.”
Flaten said farmers facing persistent delivery problems should contact a local CWB farm business representative who can provide updated details on what types of grain are moving and where.
Despite concerns over the movement of CWB grain, CWB sales have been strong and deliveries are occurring at a reasonably good pace,” he added.
“We have a very good sales book right now all the way through Christmas and beyond so we are going to be moving a lot of grain.… We’ve moved almost 25 percent of the early delivery pool (tonnage) already, so I would encourage (farmers) to stay in touch with all (grain handling companies) … because there are going to be delivery opportunities coming up for sure.”
