WEYBURN, Sask. – Higher projected new crop durum prices have prompted farmers to hang onto better quality stocks, putting the Canadian Wheat Board in a bind.
A guaranteed delivery contract (GDC) that ends March 31 was designed to help the board meet sales commitments by encouraging producers to deliver No. 1 and 2 CWAD.
However, it also left producers with lower quality durum wondering when their grain would move.
Growers at a recent farmer forum in Weyburn asked District 8 director Rod Flaman how durum sales are made and when they could deliver. They had contracted their crop under a Series A contract, but only 25 percent has moved. They also asked how the board could take uncontracted grain ahead of theirs.
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Rick Steinke, the board’s vice-president of logistics, said the idea behind the GDC was to encourage deliveries of better quality durum.
“People were saying we’ve got it but we’re not giving it to you,” he said.
Offering delivery earlier into the new pool could help the board obtain quality durum and satisfy farmers’ desire for the better price, he added.
Poor rail service and farmers’ inability to get to their bins because of snow and moisture have also hampered deliveries.
Flaman said the situation is complex.
Randy Phillips of Stoughton, Sask., said he signed a Series A contract for durum delivery.
“I have sitting on my yard uncontracted durum that is better than the contract I signed up for,” he said. “They now currently want to take the better product and the poorer product is not moving. There’s a penalty for moving the stuff that was contracted into the new pooling period coming up because it’s going to be a higher price.”
However, that penalty has been waived for this GDC.
Steinke told farmers that movement for No. 3 durum is picking up but there is limited capacity. CWAD No. 4 and 5 moves on Canadian Pacific Railway lines and none has moved. He expects it will pick up in April and May.
“It is going to be a struggle, no question,” he said of the amount left to move.
