CWB Seeks Still Higher Initial

WINNIPEG - Oct 3/07 - SNS -- The Canadian Wheat Board (CWB) has announced higher initial payments for wheat, durum and barley delivered into its 2007-08 marketing pools and has asked the federal government to authorize yet another increase.

The October 4 increase in initial payments for wheat will be CDN $28.50 per metric tons (MT). In the case of milling durum, the increase will be $43.50 per MT. For feed barley in Pool A, the increase will be $23.50 per MT, while the increase for designated barley will range from $29.50 to $36.50.

The original initial payments for wheat and durum, announced August 2, were calculated as a percentage of the May Pool Return Outlook (PRO) in order to meet federal government requirements for recommendations to be submitted by mid-June.

The barley initials were set directly by government without a CWB recommendation. Dramatic market price increases between May and August meant initial payments reflected a lower proportion of farmers' expected final return. Since August 2, there have been further market increases.

Grade                                      Initial     Adjustment     Total payment     2007-08 PRO
                                           payment     payment        to date

No. 1 Canada Western Red Spring Wheat 12.5 $147.50     $28.50         $176.00           $296
No. 1 Canada Western Amber Durum 12.5      $144.00     $43.50         $187.50           $440
No. 1 CW Barley (Pool A)                   $107.00     $23.50         $130.50           $254
SS CW 2 Row Designated Barley              $162.00     $36.50         $198.50           $290
SS CW 6 Row Designated Barley              $144.00     $29.50         $173.50           $261

Farmers who delivered wheat, durum, barley and designated barley to the CWB between Aug. 1, 2007 and Oct. 3, 2007 will receive an adjustment payment. The payments will be mailed by Oct. 19, 2007 or received by direct deposit on Oct. 16, 2007. Farmers who wish to defer payments have until Oct. 10, 2007 to notify the CWB by calling 1-800-275-4292.

Initial payments should not be confused with monthly PROs, which are CWB estimates of farmers' total returns from each of the pool accounts. Rather, initial payments represent a portion of the returns farmers can expect from the sale of their grain over the entire year.

During the crop year, the CWB regularly reviews the initial payments and recommends adjustment payments if market conditions and sales progress warrant. The Government of Canada guarantees initial payments and therefore approves the level at which they are set. The recommendation and approval process typically takes six to eight weeks.

Upon delivery, farmers may alternatively choose the CWB's Early Payment Option (EPO) as a payment method. The EPO, as with the other CWB Producer Payment Options, can be used as a cash-flow tool. The EPO allows farmers to receive an additional payment equal to 80, 90 or 100 per cent of the PRO, less a discount, within 10 business days.