High costs for switching durum to new crop
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The Canadian Wheat Board has something called the new-pool pricing option that allows farmers the choice to deliver wheat and durum in the current crop year and still get the new crop year pool price. It sounds like a way to take advantage of the higher prices expected in the new crop year, particularly for durum. However, it isn’t as good as it sounds.
There’s a per tonne fee for each class and grade. On No. 4 and 5 durum, the fee is relatively small at $7.25 a tonne. However, on No. 1, 2 and 3 durum the fee is currently $69.75 a tonne, a hefty price tag.
The CWB says switching grain from one year to the next creates uncertainty about pool size and affects the pool returns of both the old and new crop years. According to the board, the per-tonne fee offsets these impacts. The fee is regularly updated to reflect changes in the Pool Return Outlook and market conditions.
