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Gene Editing Innovations Present Many Benefits to Farmers and Their Customers

The world keeps changing rapidly through new technological advances such as gene editing. Agriculture, fortunately, benefits from many of these new technologies, helping feed more people on less land into the future.

In addition, diets and consumer preferences are changing around the world. There is increased demand for animal protein (leading to more feed grain demand), for higher quality baked products as incomes increase, a greater desire to understand product sustainability and where and how food is produced.

For centuries farmers have selected desirable traits to improve crops and livestock, including such innovations as shorter wheat plants needed to support the dramatic increase in yield potential resulting from the Green Revolution. Agriculture advances rapidly and keeps up with the changing demands largely because of advancements in production practices and plant breeding technologies through selective breeding, cross breeding, hybrids, marker assisted selection, genetic modification, and now gene editing.

Benefits of Gene Editing

Gene editing is the ability to precisely select genes in an organism’s genome to make targeted changes. This can also occur through conventional breeding – but with much more precise outcomes in less time due to gene editing. There are different types of gene editing technologies, such as CRISPR and TALENS. The advantages of these innovative breeding techniques will help bring more specific advancements in wheat to market more quickly and at a lower development cost, which would allow for a wide range of developers in the field to bring new products to market.

An image showing a wheat variety trial field to illustrate the article on gene editing in agriculture.

Gene editing offers more precise outcomes and less time getting improved wheat varieties to commercialization. For public wheat breeding programs seen in this trial at Colorado State University, gene editing also has the potential to reduce research costs.

According to a study by North Dakota State University (NDSU), the average cost of the process from research and development to market is greater for GMOs than gene editing. The study estimates that the average cost for gene editing is $13.3 million while GMOs averaged $80.7 million.

Like genetically modified organisms (GMOs) and other breeding methods, science and regulators demonstrate the safety of gene editing. Gene editing also holds excellent promise as a technology that supports sustainable food production. Desirable traits such as improving a crop’s ability to tolerate drought, producing more on less land, and improving disease resistance. Just as GMO technology has done, gene editing can help sustain a long-term reduction in the use of crop protection products and fertilizer.

Gene Editing Research

The gene editing research happening today is looking at edits that would be positive for producers, consumers and the environment. For example, Calyxt has developed high fiber wheat using gene editing. The company hopes to release that trait through a closed-loop system – potentially in the next few years. To help consumers get enough fiber in their diets, this trait would positively improve human health. There is also research to develop a modified gluten wheat variety, which could be helpful to those that have a gluten intolerance.

Gene Editing Around the World

Several signs point to this innovative technology garnering more acceptance around the globe than GMOs have received. The world is beginning to recognize gene editing as a valuable tool, and many countries are currently revising their biotechnology regulations to positively incorporate gene editing technology in agriculture.

To date, the United States, Canada, Australia, and Japan have released guidance or proposed guidance on how to regulate gene edited crops. Those concepts mainly indicate that if there is no plant pest risk or foreign DNA in the final product, the gene edited crop would not be regulated.

In 2018, the Court of Justice of the European Union ruled that gene editing technology was to be treated equally to GMOs, which are essentially banned in the EU. This spring, in a surprising announcement, the EU Commission released a report on gene editing stating that gene editing is different than GMO technology and should not be regulated in the same way. Although this is exciting, it is expected to take some time for the EU to determine its final regulations. However, this report opens the discussion for the EU to consider this new technology and see the benefits of embracing it to meet the needs of the world today, including the EU’s sustainability goals and feeding a growing population.

UK Consultation

Since separating from the EU, the United Kingdom (UK) held its own consultation on gene editing. The results from the consultation are expected to be released this year, but historically the UK has had a more positive view on science-based decisions than the EU. The UK’s Department for Environment Food and Rural Affairs (Defra) stance is that “organisms produced by [gene editing] or by other genetic technologies should not be regulated as GMOs if they could have been produced by traditional breeding methods.” The consultation only impacts England, meaning the other UK countries would have to revise their own biotech regulations. This creates a challenge for some, including Northern Ireland, since it is still treated as part of the EU customs union under the BREXIT agreement.

Should the EU accept the safety of this technology, it can positively influence regulators in other countries. Positions on gene editing in many African and Asian countries are still in the early development phase, but it is believed that China will likely embrace this new technology and regulate gene editing the same as conventionally bred crops.

If the world can take a science-based approach to gene editing, there is the potential for several positive outcomes and advancements for trade, science, sustainability, food production, and agricultural advancement. However, if the EU and other countries continue enforcing anti-science agendas, there could be a negative impact on this promising new technology. With a growing global population to feed, agriculture cannot afford setbacks.

Image is a close up of wheat breeding work to illustrate the article on gene editing in agriculture.

In the wheat breeding program at Oklahoma State University scientists work long days crossing thousands of wheat prodigy using genetic stock from around the world. Gene editing can help breeders develop varieties that produce more and better quality wheat for a growing world.

As technology advances around the world, USW hopes to see it embraced without disrupting trade. Therefore, it is essential to use a science-based approach when developing policies affecting gene editing and other new technologies. USW and the National Association of Wheat Growers (NAWG) share a joint Wheat Breeding Innovation Committee (WBIC) that has informed breeders that it expects to be notified as early as possible of any wheat trait developed through plant breeding innovation technology. In that way, USW can gain input from major importing customers before such a product enters the U.S. commercial market to mitigate and eliminate potential trade barriers. You can access WBIC principles for commercialization here and the position statement here.

By Shelbi Knisley, USW Director of Trade Policy

 

Visit these websites for more information about the benefits of gene editing innovations.

https://geneticliteracyproject.org/

https://innovature.com/

https://www.bio.org/ 

https://www.bestfoodfacts.org/category/gene-editing/

https://www.nationalgeographic.com/environment/article/food-technology-gene-editing

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How the U.S. Wheat Export System Delivers Quality and Value

Private grain companies in the U.S. wheat export system in the Pacific Northwest (PNW) overcome challenging logistics to deliver wheat that consistently meets contract specifications to buyers around the world. Grain sellers based in Gulf, Lakes and Atlantic ports operate very similar logistical systems to export wheat and other grains.

We are sharing a video and written look at how these successful companies do their work serving U.S. wheat farmers and overseas wheat buyers.

Sourcing Wheat From the Interior

An overseas buyer contracts with an exporter for wheat of specific class, grade, quality and price. It is then up to the exporter to source that wheat and get it loaded at the contracted price.

They do this reliably through a very efficient, system that moves the wheat to market using trucks, barges and rail to the vessel, often within a two-week shipping window.

U.S. wheat export system starts at country elevators.

U.S. wheat export system starts at interior elevators where wheat purchased from farmers is loaded onto train cars for delivery to export elevators.

In the U.S. wheat export system, grain sellers source U.S. wheat supplies from local elevators close to the farms.

Hard red spring (HRS) wheat comes mainly from the Dakotas and Montana. Hard red winter (HRW) wheat originates mostly in Montana, Wyoming, Nebraska and some from PNW states.

Those classes are loaded onto dedicated 110 car unit trains that haul the wheat over the Rocky Mountains and down the Columbia River Gorge to the export elevators.

Farmers deliver much of the soft white (SW) and white club wheat grown in Washington, Oregon and Idaho to grain facilities on the Snake, Columbia or Willamette Rivers where it is loaded onto barges or trains for the ports.

In the U.S. wheat export system, barge transportation is efficient and safe.

In the U.S. wheat export system, barges are the most cost-efficient transportation method. In the Pacific Northwest, wheat can move by barge to export elevators from as far away as Idaho because of the series of locks and dams that make safe, efficient navigation possible on the Columbia-Snake River System.

Because U.S. wheat is graded and segregated by class and quality at every step of the supply system, the export elevator knows they will receive the wheat they need to fill their customer’s contract.

Highly Automated Process

The receiving process at elevators in the U.S. wheat export system is highly automated. Numerous sensors and cameras allow only a few people to unload the wheat very quickly into temporary holding bins segregated by class, grade and quality.

Barges in this tributary can discharge 600 metric tons of wheat per hour. Unit train cars are opened and unloaded in less than 18 hours.

The export elevator’s shipping system is also automated. One person from a control room can select wheat from different storage bins and blend them together to be loaded onto the bulk vessel the buyer has chartered.

But, under U.S. law, that cannot happen until the wheat is inspected to certify that the quality loaded matches the customer’s specifications.

This highly regulated, standardized process is conducted by the USDA’s Federal Grain Inspection Service, or a state inspection agency supervised by and subject to the same standards as FGIS.

FGIS inspection and certification is required by law in the U.S. wheat export system.

FGIS inspection makes  the U.S. wheat export system uniquely valuable. A random sample of every sub lot of wheat is broken down into specified quantities by FGIS officials and weighing, inspection and certification is standardized and objective. FGIS inspection data also yields information that buyers can use to get the most value from their tenders. 

In this process, a specific amount of wheat is sampled every 15 to 20 seconds as it flows from the elevator into designated shipping bins holding from 1,000 to 2,000 metric tons.

The sample is collected in the FGIS lab at the elevator and the shipping bins remain closed while FGIS inspects each sample.

When the inspectors certify that the sample meets the customer’s contract specifications, FGIS opens the shipping bins, allowing the elevator to load that wheat onto the vessel. If not, the wheat in the shipping bin is returned to the elevator to be re-blended.

Quality Assurance

FGIS saves sub-lot samples from each shipping bin for 90 days in case an issue comes up when the wheat arrives at its destination.

To give the buyer additional quality assurance, about 10 percent of all samples are sent to a national FGIS Board of Appeals and Review to be re-inspected for quality control monitoring.

Those inspections generate valuable data that customers can use to get even more value from their purchases of high-quality U.S. wheat. Your U.S. Wheat Associates (USW) representative can help you make good use of this information as you write your tenders.

In the U.S. wheat export system, grain companies move wheat from inland farms and elevators to deep water ports more efficiently and economically than any wheat supply system in the world.

In the U.S. wheat export system, grain companies move wheat from inland farms and elevators to deep water ports more efficiently and economically than any wheat supply system in the world.

It is very reassuring to wheat importers that U.S. grain handlers segregate wheat by class and quality, and maintain its wholesome character, while moving wheat from inland farms and elevators to deep water ports more efficiently and economically than any wheat supply system in the world.

Learn More

More information about the U.S. wheat export supply system is available from USW online or from your local representative, including an interactive map of the system, a section on “How to Buy U.S. Wheat” and other resources.

 

 

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High Quality 2021 Soft Red Winter Wheat Crop to Deliver Excellent Performance

As they did in 2020, U.S. wheat farmers have produced an excellent 2021 soft red winter wheat crop for the world’s weak gluten wheat buyers and food processors.

Analysis of 263 samples from elevators in 18 reporting areas across 11 states that account for an estimated 73% of total U.S. SRW production indicates the crop delivers very good performance characteristics. This year’s composite characteristics demonstrate uniformly excellent kernel characteristics, benefited by timely mild temperatures and rainfall.

Other quality factors include less extensibility than in 2020 and the 5-year average, and excellent quality for cookies and crackers. There were pockets of higher enzymatic activity resulting in lower falling numbers and higher damaged starch from the East Coast and isolated portions of the Gulf Ports region, but overall, buyers should be extremely happy with the quality of the entire 2021 SRW crop. Buyers are encouraged to review their quality specifications to ensure that purchases meet their expectations.

U.S. Wheat Associates (USW) has posted the full Soft Red Winter Wheat 2021 Quality Survey on its website here.

Planting and Harvest

USDA estimates the 2021 soft red winter wheat crop seeded area at 6.59 million acres (2.67 million hectares), up from 5.63 million acres (2.28 million hectares) seeded for the 2020 harvest and up from the five-year average. Good growing conditions were overall can be seen in the excellent quality of this crop. Although harvest started slowly with cool, wet conditions, a warm-up helped growers finish in line with the 5-year average. U.S. soft red winter (SRW) wheat production, estimated at 362 million bushels or 9.85 million metric tons (MMT), a 37% increase over 2020 and a 28% increase over the 5-year average.2021 map of soft red winter wheat production and sampling.

Samples were collected and analyzed by Great Plains Analytical Laboratory, Kansas City, Mo. The results were weighted by the estimated production for each reporting area and combined into “Composite Average,” “East Coast” and “Gulf Port” values.

2021 Crop Highlights

  • Grade – the overall average for the 2021 SRW harvest survey is U.S. No. 2 SRW.
  • Test Weight averages are indicative of sound wheat and a uniform crop with Composite 59.7 lb/bu (78.6 kg/hl), Gulf average 60.0 lb/bu (79.8 kg/hl), and East Coast 58.8 lb/bu (77.4 kg/hl).
  • 1000 Kernel Weight, Kernel Diameter and Wheat Protein values reflect a relatively uniform crop.
  • Wheat Protein content demonstrates a uniform crop. The Composite average of 9.3% (12% mb) and Gulf Ports average of 9.2% are lower than the 5-year averages. The East Coast average of 9.5% is slightly higher than 2020 but below the 5-year average.
  • Wheat Falling Number trended lower this year due to localized rainfall during harvest with Composite (297 sec), East Coast (257 sec) and Gulf Ports (307 sec) all below 2020 and 5-year averages. USW Regional Technical Director Peter Lloyd said while low falling number values are not eliminated from the survey, “the very few problem areas resulting from late rains will most likely never come to market.” Buyers will have no problems when they use a minimum 250 second falling number in their specifications.
  • Vomitoxin (DON) averages are well below the USDA threshold of 2.0 ppm with Composite at 0.8 ppm, Gulf Ports 0.9 ppm and East Coast 0.2 ppm. “DON levels are among the lowest we have seen in some time,” Lloyd said.
  • Laboratory Mill Flour Extraction for Composite (65.9%), East Coast (65.4%) and Gulf Ports (66.1%) are below 2020 and the 5-year averages but still indicate a good milling crop.
  • Damaged Starch values are slightly higher this year and can be attributed to higher enzymatic activity in isolated areas.
  • Amylograph averages indicate relatively high levels of amylase activity in portions of the crop with low falling numbers. Averages for Composite (440 BU), East Coast (290 BU) and Gulf (477 BU) are lower than last year and 5-year averages.
  • Solvent Retention capacity values generally indicate excellent quality for cookies and crackers. Lactic Acid values are above 100 and below 120, indicating excellent quality for crackers
  • Dough Properties suggest that this crop has similar protein qualities to last year but weaker than the 5-year average.
  • Alveograph L averages for Composite, East Coast and Gulf are 56 mm, significantly lower than 2020 and 5-year average values and indicate low extensibility.
  • Average Loaf Volumes are lower than last year and 5-year averages.
  • The Cookie Spread Ratios for Composite (10.6), East Coast (10.8) and Gulf (10.5) are all higher than last year and 5-year averages, indicating good spreadability.

2021 Crop Quality Data on Other U.S. Wheat Classes

Hard Red Spring
Soft White
Hard Red Winter
Northern Durum
Desert Durum® And California Hard Red Winter
Hard White

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Wheat Industry News

Recent news and highlights from around the U.S. wheat industry.

Speaking of Wheat.

“We need moisture.” – Glen Squires, Chief Executive Officer, Washington Grain Commission, in an article by the Associated Press on how drought in eastern Washington state has cut soft white wheat production and created concerns about the next crop.

Borlaug Global Rust Initiative Announces 2021 Global Wheat Conference. The Borlaug Global Rust Initiative (BGRI), formed in 2005, will host a virtual conference Oct. 6 to 8, with the theme “Global Resilience: Science, Pandemics, and the Future of Wheat.” The 2021 BGRI Virtual Technical Workshop will explore how nearly two decades of monitoring and responding to wheat rust epidemics can teach other global disease outbreaks such as COVID-19. The online-only event is open to all and free for registrants. Learn more about the conference and register here.

Friend and Colleague Receives Boy Scouts of America’s Silver Buffalo Award. Reid Christopherson, executive director of the South Dakota Wheat Commission, one of USW’s state wheat commission members, will receive the Silver Buffalo Award from the Boy Scouts of America. This is the highest award presented for volunteer service. Christopherson will be among 826 recipients since 1926. Christopherson has been involved with the Boy Scouts of America for 53 years. Congratulations to our friend and colleague on this prestigious award! Read more here about this honor.

Oregon Wheat Hiring. The Oregon Wheat Growers League and Oregon Wheat Commission are hiring a new Director of Communications. This position supports the Chief Executive Officer to provide the development and growth of Oregon Wheat communications, outreach, advocacy, education and public relations programs. Read more about the position and how to apply here. The position will stay open until it is filled but apply for first-round consideration by September 7, 2021.

U.S. Wheat Associates Publishes Commercial Sales every Thursday, documenting wheat export sales-to-date by country and class for the current marketing year compared to the previous marketing year on the same date. The report includes a 10-year commercial sales history by class and country. Data is sourced from the USDA Foreign Agricultural Service Weekly Export Sales Report. Read the latest report on the USW website.

Subscribe to USW Reports. USW publishes various reports and content that are available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online. Visit our Facebook page for the latest updates, photos and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and more on LinkedIn.

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Global Wheat Stocks-to-Use Ratio Supports Bullish Prices Outlook

USDA’s August 2021 World Supply & Demand Estimates (WASDE) report trimmed expected global wheat production, reduced the global wheat stocks-to-use ratio and created a supply shock market rally. USDA dropped total production to 777 million metric tons (MMT), 15.4 MMT less than its July forecast, citing major weather problems in Russia, Canada and the United States. Global wheat use forecast for 2021/22 is 787 MMT.

Wheat supply is of course a major variable in global price discovery and is related to the “stocks-to-use” ratio, representing the level of carryover stocks as a percentage of the total demand or use. These new USDA estimates reduced the global stocks-to-use forecast to 35%, which, if realized will be its lowest since 2016/17. If China’s massive wheat stocks are removed from the calculation (China exports very little wheat), the stocks-to-use estimate is 21.6%.

A chart showing global wheat stocks-to-use ratios for last 10 years.

Global wheat stocks-to-use percentage has declined after an eight-year run-up. Source: USDA August 2021 WASDE and USW Supply and Demand Report.

Guy Allen, Senior Economist at IGP Institute at Kansas State University, points out that an important consideration when looking at the wheat stocks-to-use ratio is to compare the ratio to corn as well. While wheat is primarily a food grain, it can compete with feed grains given relative prices or regional shortages. The current global stocks-to-use ratio forecast for corn is 24%, also lower than its ratio the past few years.

Supply Shock Source

How did the world get to this point? Global use continues to set records each year and ending stocks declined in 2020/21 and again this marketing year. It is major exporting countries taking the supply hit this year. In fact, Stratégie Grains, a French grains analyst, said that the stocks-to-use ratio for major exporting countries could fall to its second-lowest level on record after 2012/13.

USDA slashed Russia’s production forecast 12.5 MMT to 72.5 MMT. The Russian statistical agency, Rosstat, reduced the number of winter wheat acres harvested while the Ministry of Agriculture reported lower yields. In Canada, the Prairie Provinces saw production decline after persistent drought slashed yields by 24% compared to the 5-year average. USDA reduced its Canadian production forecast by 32% compared to 2020/21 to 24.0 MMT. If realized, it will be the smallest Canadian wheat crop since 2010/11.

U.S. Wheat Balance Sheet

USDA also lowered U.S. production 7% compared to last year as drought has affected several wheat-growing areas including the Northern Plains states and the Pacific Northwest (PNW). The total stocks-to-use ratio in the U.S. is forecast at 30% for 2021/22, down 10% from 2020/21’s total stocks-to-use ratio of 40%. This is not surprising considering that all wheat classes started with lower beginning stocks in 2021/22 and of the five wheat classes tracked by the USDA in its monthly report all wheat classes except for hard red winter (HRW) and soft red winter (SRW) are expected to have lower ending stocks. Even with the higher production in HRW and SRW, the stocks-to-use ratio is forecast lower for all wheat classes in 2021/22. U.S. white wheat, primarily soft white grown in the Pacific Northwest (PNW) is the most affected with 16% stocks-to-use compared to 21% last year.

U.S. wheat stocks-to-use data for August 2021

USDA now expects the 2021/22 stocks-to-use ratio for each major U.S. wheat class to decline. Source: USDA August 2021 WASDE and USW Supply and Demand Report.

With harvest well underway for many classes (HRS, S.W.) and complete for HRW and SRW the market is getting a better indication of how accurate the USDA’s production number is. The September WASDE report will account for more known production in the United States and other major exporting countries. USDA will also publish its quarterly Grain Stocks report at the end of September that will also add to our understanding of how much wheat is available.

By USW Market Analyst Michael Anderson

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Thank You and Best Wishes to USW Colleague Matt Weimar

U.S. Wheat Associates (USW) will sadly say goodbye to our long-time colleague and friend Matt Weimar who is leaving his Singapore-based position as Regional Vice President for South Asia and Senior Advisor for Asia on Sept. 1, 2021, to pursue new interests.

USW President Vince Peterson notes that U.S. wheat producers have been well served by the export market development organization that they envisioned and created decades ago.

“But the bottom line of that success has come from many decades of effort by people like Matt Weimar who have dedicated their entire careers to the service of our industry,” he said.

Several of Matt’s colleagues wanted to share the following thoughts and best wishes.

Vince Peterson, USW President

“Matt’s dedicated career has been an exemplary example of the ‘boots on the ground’ philosophy U.S. wheat producers embedded into their organization. That involves living in our customers’ regions, getting to know them and their business interests personally, and building a long-term, lasting level of confidence and trust. It allows USW to effectively promote wheat exports to these markets and constructively address any problem that may occur.”

Demonstrating Matt Weimar relationship with customers.

Matt Weimar, right, with Ms. Sisi Xu, Director, Sino-American Baking School, Guangzhou, China.

“Matt’s success for USW in Asia is well known, recognized and respected by our customers and state-side organizations and farmers he has worked with over these many years. He will be highly missed by all of us on both sides of the Pacific, but his legacy and friendship will endure. Matt leaves USW not only with our thanks, but also our very best wishes as he begins this next chapter in his life.”

Shirley Lu, USW Country Director, China

“Matt has been a mentor to me before and after I joined USW, and I am always grateful for his support and guidance. He led the team, taught, shared, and encouraged us. He has done so much for so long that it is impossible to single out individual things he achieved. His dedication to the Chinese market has laid the groundwork for the successes we have enjoyed recently. Our friends in China as wheat buyers, millers and food processors enjoyed the good relationship he built between the industry and USW, and they have been missing him a lot. Although sad to see him retiring, we are so happy that he will return to Hong Kong, where we can remain in touch!”

Several people at a baking school in Bangkok, Thailand.

USW Director and Washington farmer Gary Bailey, Matt Weimar, USW VP, Global Technical Services Mark Fowler and USW Bakery Consultant Roy Chung visiting the United Flour Mills (UFM) Baking and Cooking School in Bangkok, Thailand.

Jeff Coey, USW Regional Vice President, China and Taiwan

“In USW’s world, every overseas posting presents unique challenges, and there is no book that outlines what new colleagues need to know about any particular market. So, I was very lucky to have Matt as a predecessor in the greater China markets. When I had a question, and I had many, behind every answer was a background story, and you did not get the lesson without the story behind it. Fortunately for me, Matt was unstinting with his time and was always ready with the stories and lessons.”

Matt Weimar with colleagues at a China food trade show.

Janice Mattson, Past USW Chairperson and Montana wheat farmer, Pansy Lam, Retired Associate Regional Director, China/Hong Kong, Matt Weimar, Peng Fei Zhong, Deputy General Manager, Guangdong Baiyan Grain & Oil Industrial Co., Ltd. retired USW President Alan Tracy, and Philip Zhou, President, Sino-American Baking School, attended the China International Baking Industry Expo in Shanghai in 2011.

“Besides his embodiment of ‘institutional knowledge,’ Matt had built many strong relationships as he conducted trade service and technical support for customers year by year over decades. Whether it be with growers, mills, traders or staff, Matt set a great example for me and for the others who worked with him. I will always be grateful for his support and wish him well in whatever adventures come next.”

Joe Sowers, USW Regional Vice President, South Asia (effective Sept. 1, 2021)

“After a long and productive career with USW, I’d like to congratulate Matt on his immense and lasting impact, guiding offices and personnel and managing operations across much of the Asia Pacific region. During his tenure in South and Southeast Asia, Matt quickly built strong and meaningful relationships with key players, gaining their trust, and helping businesses thrive and grow. His success is evidenced by U.S. wheat sales increasing at a rate and scale unparalleled anywhere in the world during his time in the region. Matt led successful marketing efforts with his unique and energetic enthusiasm for initiating innovative programs. All of us in the Singapore and Manila offices wish him the best in his future endeavors.”

A group of men in a wheat field.

Matt Weimar (left) travelled often back to the United States with regional trade teams. Here, he is with a Thailand milling team at Bailey Farms in Whitman County, Washington. Glen Squires, CEO, Washington Grain Commission (right) joined the team in 2019.

Glen Squires, Executive Director, Washington Grain Commission

“Congratulations Matt on your exemplary years of enthusiastic service to the U.S. wheat farmer. Matt was the first USW overseas employee I met as we touched down in Hong Kong on board team travel with Rick Callies (retired). Since that time Matt has always been a go-to person for insight, expertise and guidance about various markets. His relationships and efforts with millers/buyers and foreign government officials, along with knowledge of all things China and subsequently South Asia have provided detailed value to us all. No one can hold a candle to Matt’s unbelievable memory, attention to detail and knowledge of individual people and companies. Matt, on behalf of the Washington Grain Commission, thank you for all you have done to help expand and solidify the use of U.S. wheat in oversea markets.”

Matt, from all of us at USW, 再见, 祝你好运, 亲爱的朋友.

Photo of Matt Weimar

In the photo at the top of this page, USW colleagues joined Matt Weimar at a 2014 event celebrating the 30th anniversary of long-time educational partner the Sino-American Baking School in Guangzhou, China. Left to right: Shirley Lu, Country Director, China; Kaiwen Wu, Marketing Specialist, China; the late Ronald R.L. Lu, who served as Country Director, Taiwan; Pansy Lam, Retired Associate Regional Director, China/Hong Kong; Steve Mercer, Vice President of Communications; Sophia Yang, Past Asian Products/Nutrition Technologist, Taiwan; Mike Miller, Past USW Chairman and Washington wheat farmer; Matt Weimar; Peter Sutter, baking consultant; and Andy Zhao, retired Country Director, China.

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U.S. Agricultural Organizations Ask for Positive Reforms at the World Trade Organization

U.S. Wheat Associates (USW) recently joined a coalition of several U.S. agricultural organizations calling on the Biden Administration to work toward reforms to the World Trade Organization (WTO) “that lead to a market opening agenda for agriculture and a better functioning institution.”

USW signed the July 23, 2021, letter to U.S. Trade Representative Katherine Tai and Secretary of Agriculture Tom Vilsack because it believes the WTO’s mission to liberalize global trade has benefitted the wheat farm families the organization represents and the world’s wheat importers. As the coalition stated on liberalized trade, “It helps connect American farming communities to peoples around the globe.”

Since it was formed in 1995, global wheat trade has doubled. The WTO provides a trade dispute mechanism that has identified the need to amend trade-distorting practices such as China’s domestic wheat support and unfilled wheat import tariff rate quota.

However, the letter also pointed out that “When the WTO functions poorly, and other governments get away with treating U.S. agriculture exports unfairly, trust erodes in our government and international institutions. To restore trust, WTO reform is needed.”

Leading issues of discussion at the WTO include challenges on tariff implementation, domestic support, transparency, sustainability, and climate. Following are some of the areas the coalition would like the U.S. officials to address at the WTO Ministerial Conference (MC12) in late November 2021:

  • Public stockholding (PSH) disciplines – PSH programs may serve a laudable food security goal but often lead to excessive domestic stockpiles, as we have seen in India and China. Those stocks lead to lower global prices and may force U.S. farmers to compete with subsidized exports.
  • Special safeguard mechanism (SSM) rules – SSM’s allow developing countries to temporarily impose import tariffs to protect domestic producers from competition, and at times may unfairly tax U.S. exports.
  • Domestic support limits – Domestic support, a subsidy that encourages production, is one of the most discussed topics in Geneva. Some countries want the U.S. and EU (both of whom are within the limits they agreed to) to slash their farm program spending, while the U.S. argues that many advanced developing countries are dramatically exceeding their own limits. The coalition supports negotiating new limits on domestic support if market access is also considered.
  • Export restrictions are policies that may limit the amount of a product being exported from a country in the form of a tax or set quantity. Some countries will impose export restrictions on commodities to control domestic prices. During the COVID pandemic, Russia imposed export restrictions on wheat exports to control domestic wheat prices. Countries are expected to consider a proposal to exempt purchases by humanitarian organizations like the World Food Program from these limits.

Addressing transparency is a leading concern because it has a significant effect on market access and export competition. For example, global wheat production and trade are negatively impacted by India’s domestic support policies for wheat. Resolving such issues would help the market operate more freely and allow more fair and equal trade for all wheat producers.

The world continues to change, and the demand on the agricultural industry to feed more people in more environmentally and socially sustainable ways is increasing. The coalition supports using science-based approaches to embrace innovations and technologies to address these challenges of sustainability and climate. Also, with this, the coalition supports a declaration on sanitary and phytosanitary (SPS) measures, which would establish a committee on SPS measures to focus on harmonized regulation, risk analysis, sustainability, and innovation at the WTO.

USW remains committed to the WTO’s mission and believes that, with positive reforms, the organization can once again become a functioning, trusted institution for equal and fair trade for the people of the world.

By Shelbi Knisley, USW Director of Trade Policy

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Wheat Industry News

Recent news and highlights from around the U.S. wheat industry.

Speaking of Wheat.

“The overall sentiment is not great, but they are farmers, so they are thinking next year is going to be better.” – Casey Chumrau, Executive Director, Idaho Wheat Commission, describing the farming community’s outlook. Read more.

U.S. Millers Weigh in on Drought Effects. Reuters reports that millers and bakers are draining wheat reserves and paying more for spring wheat used in baking, as drought shrivels crops across the Canadian Prairies and northern U.S. Plains that produce more than half of the world’s world’s supply. While overall global wheat stocks are large, the drought affects mainly the high-protein spring wheat crop that millers such as Archer Daniels Midland Co (ADM.N) and bakers, including Grupo Bimbo (BIMBOA.MX), rely on to produce the texture and moistness in baked goods that consumers expect. Read more.

Oregon Wheat Hiring. The Oregon Wheat Growers League and Oregon Wheat Commission are hiring a new Director of Communications. This position supports the Chief Executive Officer to provide the development and growth of Oregon Wheat communications, outreach, advocacy, education and public relations programs. Read more about the position and how to apply here. The position will stay open until it is filled but apply for first-round consideration by September 7, 2021.

U.S. Wheat Associates Publishes Commercial Sales every Thursday, documenting wheat export sales-to-date by country and class for the current marketing year compared to the previous marketing year on the same date. The report includes a 10-year commercial sales history by class and country. Data is sourced from the USDA Foreign Agricultural Service Weekly Export Sales Report. Read the latest report on the USW website.

Subscribe to USW Reports. USW publishes various reports and content that are available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online. Visit our Facebook page for the latest updates, photos and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and more on LinkedIn.

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Checking the 2021/22 Global Wheat Crop Ahead of August WASDE Report

The effects of weather on the 2021/22 global wheat crop have sparked a run-up in prices even as harvest progresses in the Northern Hemisphere. Given the market’s supply concerns, U.S. Wheat Associates (USW) gathered information from major wheat exporting countries to see what may affect USDA’s next estimates of world supply and demand due on Aug. 12.

Both USDA and the International Grain Council (IGC) still expect 2021/22 global wheat crop production to reach a record level. USDA’s July estimate of 792.4 million metric tons (MMT) was down 2.0 MMT from June. IGC trimmed its latest forecasts by about 1.0 MMT to 788 MMT.

Hot, dry weather in the northern and Pacific Northwest (PNW) regions of the United States and, recently, in Canada, has attracted much of the market’s attention.

United States

The Wheat Quality Council Hard Spring and Durum Tour estimated this year’s hard red spring (HRS/DNS) yield average at 29.1 bushels per acre, compared to 43.1 bushels per acre in 2019. Even so, the tour’s consensus is HRW/DNS protein and kernel size will be very good. U.S. northern durum and soft white (SW) wheat yields are also expected to be down significantly. On the other hand, hard red winter (HRW) and soft red winter (SRW) average yields and production are expected to be higher for 2021/22. In addition, Kansas-based HRW grower Brian Linin, noted, “We put a lot into this crop. Protein [levels] have been awesome.” Follow USW’s weekly Harvest Report for more information.

HRS wheat rows showing effect of drought in North Dakota

Drought in the Northern U.S. Plains could cut the 2021/22 HRS/DNS yield average by one-third, but industry experts expect protein and kernel quality will be good.

Canada

Canada, the largest spring wheat producer, has experienced record temperature and drought in portions of its Prairie Provinces. Agriculture and Agri-Food Canada (AAFC) cut its most recent forecast of spring wheat production by 11% to 25.6 MMT, down sharply from previous estimates. That agency also reduced spring wheat export forecasts to 17.7 MMT, down 16% from last year.

South America

In Argentina, dry weather is also a concern, depleting soil moisture for the winter wheat crop and creating a logistics headache. The Buenos Aires Grains Exchange (BAGE) reported potential leaf damage and developmental delays caused by a severe cold front in July. Neighboring Brazil and Paraguay have also experienced potentially damaging cold weather. Brazil experienced some of the lowest temperatures in years throughout July. One local newspaper in Paraguay, “La Nación,” reported there may be a need to import wheat this year instead of marketing excess domestic production.

EU

The European Union’s top wheat-producing states, France and Germany, received persistent rain leading to flooding in some areas, which slowed harvest and created quality concerns. On Aug. 3, France’s farm ministry lowered the estimate for wheat production there by 410 thousand metric tons (TMT), but total production is still expected to be at least 25% more than in 2020/21. In a report following the flooding, a German farmers group suggested there may be crop failures in many areas. Despite this, total German production is expected to be 23.1 MMT, up almost 5% compared to last year. Further east, Romania and Bulgaria each expect to harvest record crops, although official reports said rains could downgrade a portion of Bulgaria’s harvest to feed.

Black Sea

USDA’s May Russian wheat production forecast of 85.0 MMT was seen as bullish by many at the time. Two private Russia-based analysts cited lower-than-expected yields in the Central and Volga regions when they cut their production estimates recently. IKAR cut its forecast for the 2021 wheat crop by 3.0 MT to 78.5 MMT and SovEcon cut its forecast 6.6% to 76.8 MMT. Rosstat, the Russian state statistics agency, reduced winter wheat planted area by 7.5% compared to last year, blaming dry weather. Export prices, as a result, increased at least $7 per MT following the news. The current Russian government export tax scheme is also adding part of that increased export cost.

Ukraine’s wheat harvest lags last year’s pace but yields are up 12% compared to 2020. In reaction to reduced wheat production in Russia, prices for Ukrainian wheat gained $3 to $5 per MT settling between $240 to $243 per MT. The USDA estimates Ukraine’s wheat production to rise 15% this year to 30.0 MMT.

According to one Ukrainian-based broker, farmers in Kazakhstan are expecting a 30% drop in wheat production this year from hot, dry weather in the early summer. The Kazak government is considering banning feed wheat exports while also considering a tax on milling wheat exports following a meeting of the foreign affairs and trade commission last month.

Australia

Wheat growing areas of Australia, especially Western Australia, are “looking extremely good” said one analyst with the Australian Export Grain Innovation Centre. Production estimates are expected to fall 17% compared to 2020/21 when Australia produced a record crop. This year’s crop is expected to be 15% above the 10-year average to 28.5 MMT following a 1% increase to the planted area. Some areas are reporting water logging and would benefit from a couple of weeks of sunny dry weather to dry out the fields.

screenshot from Australian Export Grain Innovation Centre

The Australian Export Grain Innovation Centre reports a second year of good wheat production potential after breaking a severe drought in 2020.

In-Born Optimism

Back in the drought areas of the United States, many wheat farmers are looking ahead to the next crop with winter wheat seeding likely to start in some areas by early September. In an interview with the Pacific Northwest Ag Network, Casey Chumrau, Executive Director of the Idaho Wheat Commission, described the farming community’s outlook this way: “The overall sentiment is not great, but they are farmers, so they are thinking next year is going to be better.”

By Michael Anderson, USW Market Analyst

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The Passing of Ron Lu

U. S.  Wheat Associates (USW) colleagues and many friends in Taiwan were very sad to learn that retired USW Country Director Ron Lu passed away July 23, 2021, in Taipei at the age of 73. Our most sincere sympathy goes out to Ron’s family and friends.

Ron Lu at CGPRDI with bakery students

In 2016, Ron Lu talked with Taiwanese bakery students at the China Grain Products Research Institute (CGPRI), which he served as Chairman. This photo was taken during a joyous celebration marking 50 years of representation in Taiwan by USW and its legacy organization Western Wheat Associates.

Ron L. J. Lu retired from USW in 2017 after 33 years of service to U.S. wheat farmers and the Taiwan milling and baking industry he loved. In September 2016, USW shared these tributes to our colleague.

“Today, per capita wheat consumption in Taiwan has exceeded that of rice. It is a market that prefers the quality and reliability of U.S. wheat and Ron played key roles in that success,” said USW Regional Vice President Matt Weimar. “USW has a strong presence in Taiwan, across all sectors and entities in the food industry because of that dedication and commitment representing U.S. wheat farmers. By hosting so many public introductions of those new wheat food products with his customers and educational partners, Ron truly [was] the face of U.S. wheat in Taiwan.”

Ron Lu with USW colleagues and the owner of R Den Dessert Factory

Ron Lu (right) often brought visiting colleagues and U.S. wheat farmers to the delightful R Den Dessert Factory in Yilan City, Taiwan. Here, USW Regional Vice President Matt Weimar (left), Past USW Chairman and Ritzville, Wash. wheat farmer Mike Miller visit with R Den proprietor Lai Wen-dian.

Lu joined USW in 1983 as a technical specialist and was appointed country director in 2004. During his tenure, Lu worked directly with end users and importers to help them strengthen commercial links with U.S. export companies through trade servicing, technical assistance and promotional activities. From 2007 to 2009, Lu served as the chairman of the China Grain Products Research and Development Institute (CGPRDI). During his USW career, he has facilitated countless customer and trade team visits to the United States, including the biennial Agricultural Trade Goodwill Mission during which the Taiwan Flour Mills Association (TFMA) traditionally signs letters of intent to purchase U.S. wheat during the following two marketing years.

Ron Lu and Taiwan team at the Wheat Marketing Center, Portland, Ore., in 2013.

Ron Lu (left) often travelled to the United States during his 33 years with USW, hosting Taiwanese flour miller trade teams like this one in 2013 outside the Albers Mill Building headquarters of USW West Coast Office, the Wheat Marketing Center (WMC) and Oregon Wheat Commission. This photos is from a tribute to Ron from his colleague and friend Gary Hou (right), who was WMC’s Technical Director at the time and is now Managing Director, Flour Business Unit, SPC Group, Korea.

“Over many years, Ron added value to every level of USW’s work in Taiwan — from improving and creating the finest wheat food products for consumers to strengthening the long-standing trade relationship between Taiwan and the United States,” said USW President Vince Peterson. “Through his steady efforts and successes, he made immeasurable contributions to both the wheat food industry in Taiwan and the U.S. wheat production and export industries.”

Ron Lu at a 2011 media event celebrating the development of healthy bread products for the Taiwanese people.

In his position as USW Country Director, Ron Lu (second from right above) worked closely with the Taiwan milling and baking industry to help develop and promote new wheat products made primarily with flour from imported U.S. wheat. Today, per capita consumption of wheat food exceeds rice.

 

 

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