Wheat Letter Blog Archive - Page 6 of 104

South Asia, Sustainability, Trade Service Activities

AG Supply Chain Asia Conference 2024: Driving Sustainable Agricultural Excellence

In March 2024, the annual AG Supply Chain Asia (ASCA) Conference took place in Bangkok, Thailand, highlighting sustainability and innovation as integral components shaping the future of agriculture. The conference provided a significant platform for discussions centered on the theme “Integrating Sustainability and Innovation for Future Agricultural Excellence.”

Organized by the U.S. Wheat Associates (USW), U.S. Soybean Export Council (USSEC), and U.S. Grains Council, and, this notable event drew more than 370 attendees from 20 countries, representing over 170 companies. The conference organizers are grateful for the support from U.S. farmer organizations and industry sponsors.

“This conference is an excellent opportunity to reinforce the value of the reliable U.S. agricultural export supply system with our colleagues representing U.S. grain and soybean growers,” said Joe Bippert, USW Assistant Regional Director, South and Southeast Asia. “There were several flour millers from Thailand at the conference. USW Noodle Technologist Ivan Goh and I also made a trade service call on a Thai flour mill after the conference.”

According to participant feedback, the AG Supply Chain Asia conference facilitated transactions and negotiations estimated at 1.5 million metric tons of U.S. agricultural products including 220,000 metric tons (MT) of wheat, 335,000 MT of soybeans, 385,000 MT of soybean meal, 180,000 MT of corn, 340,000 MT of Dried Distiller Grains with Solubles (DDGS). This positions the event as a key gathering within the agricultural sector in Southeast Asia.

Advancing Global Food Security Through Sustainability

U.S. Ambassador to Thailand, Robert F. Godec, emphasized the pivotal role of ASEAN in the global agricultural landscape. He underscored the need for sustainable food systems to address evolving challenges like climate change and to ensure global food security. Amb. Godec highlighted the ASEAN region’s significance as the United States’ fourth largest agriculture export market.

In a presentation to the AG Supply Chain Asia conference, Bippert highlighted the current wheat supply landscape and the demand outlook, noting that various factors such as the Russian invasion of Ukraine, droughts, and geopolitics have influenced market dynamics and prices. Despite these uncertainties, he emphasized the dynamic nature and the strong commitment to environmental and economic sustainability within the U.S. wheat industry. See “Stories of Stewardship” online for more information.

The annual AG Supply Chain Asia conference has firmly established itself as a robust venue for networking, fostering trade discussions, and business prospects for U.S. agricultural products. By facilitating pivotal discussions and offering insightful perspectives, the event provided a holistic view of the future landscape of U.S. agriculture, underlining the indispensable role of sustainable practices and technological advancements in attaining agricultural excellence.

The photo at the top of this page from the conference includes U.S. agricultural export cooperator leadership (USW’s Joe Bippert is 3rd from left) together with Robert F. Godec, U.S. Ambassador to Thailand, U.S. Embassy (7th from left) and Ms. Kelly Stange, Agricultural Counselor for Thailand, Myanmar and Laos, USDA’s Foreign Agriculture Services, Thailand (6th from left).

USW thanks the USDA Foreign Agricultural Service for its support of the conference and administration of export market development programs. This article was also funded in part by the soy checkoff.

May 7, 2024/by Steve Mercer

Wheat Industry News

News and Information from Around the World Wheat Industry

Speaking of Wheat

“I am truly appreciative of the support provided by the O.A. Vogel Endowment and what it has meant to growing the spring wheat breeding program over the past eight years. With our current levels of federal funding, extramural grants, Washington Grain Commission support, and variety royalty revenue reinvestment, I feel like it is great time to re-direct these endowment funds to where they can do the most for Washington growers.” – Washington State University Professor and Wheat Breeder Mike Pumphrey (photo above), who is stepping down from the O.A. Vogel Chair of Wheat Breeding and Genetics.

Chad Weigand Marks 15 Years with USW

Chad Weigand, Regional Director, Sub-Saharan Africa

Chad Weigand joined U.S. Wheat Associates (USW) on April 30, 2009, as Market Analyst following a post-graduate internship with the USDA Foreign Agricultural Service. In 2011, Chad was promoted to Assistant Regional Director in the USW Mexico City office covering Mexico, Central America, and the Caribbean. He currently serves as Regional Director, Sub-Saharan Africa, in Cape Town, South Africa. Congratulations, Chad, and thank you for your service!

Washington Grain Commission Honors Wheat Breeder

The Washington Grain Commission (WGC) is recognizing Washington State University (WSU) spring wheat breeder Mike Pumphrey and celebrating his contributions to the Washington wheat industry. Pumphrey, a professor in WSU’s crop and soil sciences department, co-held the O.A. Vogel Chair of Wheat Breeding and Genetics with WSU winter wheat breeder Arron Carter. Pumphrey informed the WGC in January that he is stepping down from his Vogel chair appointment to better focus on his WSU teaching and research activities. As a Vogel chair, Pumphrey participated in trade team and technical servicing activities through U.S. Wheat Associates (USW). “Mike, as a lifelong learner, understands that it is important to produce wheat varieties that meet the end-use quality characteristics valued by wheat buyers in the rapidly growing overseas markets in Southeast Asia,” said Steve Wirsching, Vice President and Director of the USW West Coast Office in Portland.

USW, NAWG Participate in Farm Broadcaster Issues Forum

U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) shared a booth at this week’s Washington Watch “Issues Forum” hosted by the National Association of Farm Broadcasting (NAFB). USW Director of Trade Policy Peter Laudeman had several discussions with members of the ag media during the event. He fielded questions about the broader opportunity for gene editing regulations and research – innovative technologies that have potential for higher and more stable wheat yields in the U.S. that could bring a change in global export competitiveness. Laudeman also discussed the recent USDA announcement of $1B in funding for international food assistance, a portion of which will purchase U.S.-grown wheat for international humanitarian donations.

Peter Laudeman, Director of Trade Policy, is interviewed at NAFB Washington event.

Wheat Foods Council Hosts Denver Food Professionals for ‘Culinary Immersion’

The Wheat Foods Council (WFC) recently hosted a culinary immersion in Denver aimed at educating and inspiring high-volume food professionals about wheat and wheat foods. The tour included stops at local bakeries, restaurants and manufacturers who specialize in notable applications of wheat. Each stop highlighted a unique and creative use of wheat and allowed attendees to hear (and taste) the proprietors’ skill and inspiration firsthand. The event also allowed chef attendees in depth interaction with the WFC executive team members who were able to impart their industry knowledge and passion and build loyal and lasting relationships with this key group of foodservice professionals.

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USW publishes various reports and content 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 YouTube, and more on LinkedIn.

May 2, 2024/by Steve Mercer

Market and Crop Analysis, Tyllor Ledford, USDA, Wheat Export Supply System

Marketing Year 2023/24 Countdown; First Look at New Crop U.S. Wheat Sales

With just 6 weeks left in marketing year (MY) 2023/24, many buyers are locking in purchases for June and July shipment, shifting much of the export focus to MY 2024/25, or “new crop,” U.S. wheat sales that are gradually ramping up at a faster pace compared to a year ago. The following will outline MY 2023/24 sales pace to date and provide an initial look at MY 2024/25 export sales.

2023/24 Recap

Throughout MY 2023/24 market conditions turned back to buyers. From June 1, 2023, to present, U.S. wheat FOB export price dropped 15% on average for all classes and export locations. This trend was driven by Black Sea competition pressuring U.S. and global wheat prices. As of April 30, 2024, Russian wheat is still the cheapest on the world market, at $214 per metric ton (MT) FOB (12.5% protein on a dry moisture basis).

As world wheat values fall, U.S. prices follow, and the lower prices have helped boost exports for two U.S. wheat classes. In MY 2023/24 to date, China imported over 1.2 million metric tons (MMT) of soft red winter (SRW), contributing to a 51% increase in total SRW export sales as of April 18, 2024. Likewise, hard red spring (HRS) sales hover 13% ahead of the year prior at 6.4 MMT, making up 34% of the total U.S. wheat export sales. Nonetheless, the positive export performance for HRS and SRW does not offset the significant decline in hard red winter (HRW) and soft white (SW) exports. To date, HRW exports sit at 3.6 MMT, down 28% from the year prior. Likewise, SW exports sit 15% below last year’s pace.

We can expect the 2023/24 sales pace to decline further as customers seek shipments for June and July delivery. For the week ending April 18, for example, net sales of just 82,000 metric tons (MT) were reported for delivery in 2023/24. Despite increased exports for some classes, USDA expects wheat exports to reach 19.3 MMT, the lowest level since 1971/72 if realized. Moreover, the current pace puts total commitments to date 500,000 MT below the projections.

This line and bar chart compares USDA's export estimate to the by-week pace of sales in 2022/23 and 2023/24 and to the 5-year average sales pace, indicating a decline in sales.

For the week ending April 18, net sales of 82,000 MT were reported for delivery in 2023/24. Year-to-date 2023/24 commercial sales totaled 18.8 MMT. USDA expects 2023/24 U.S. wheat exports of 19.3 MMT, and commitments to date are 97% of total projected exports. Current exports sit just 1% ahead of last year’s pace, but 17% below the five-year average. Source: USDA FAS Export Sales.

Strong Start

Despite the slower pace of U.S. wheat sales in MY 2023/24, the new crop outlook for 2024/25 is more optimistic. Buyers are beginning to take advantage of lower prices and securing early shipments for MY 2024/25. For the week ending April 18, the total known outstanding sales for MY 2024/25 reached 2.1 MMT, 112% ahead of last year’s pace, with net sales coming in at 371,858 MT.

HRS continues to lead export sales, with 743,580 MT sold to date, a 211% increase from last year. Likewise, soft white sales are up 670% at 675,180 MT, HRW is up 100% to 347,200 MT, and durum sales are up 80% at 66,500 MT. Acting as the outlier, SRW sales are 34% behind last year, at 314,200 MT as prices remain elevated relative to SW.

This bar chart shows new marketing year U.S. wheat sales to the top 10 countries by volume in 2023 and 2024 as of mid-April.

For the week ending April 18, the total known outstanding sales and accumulated exports of all classes of wheat for the 2024/25 marketing year reached 2.1 MMT,112% ahead of last year’s pace, with net sales coming in at 371,858 MT. HRS export sales sit 211% above last year, SW 670% higher, HRW 100% higher, and durum 80% higher. Acting as the outlier, SRW sales are 34% behind last year’s pace. Source: USDA FAS Export Sales.

Contributing to the sales increase, several customers have already bought more U.S. wheat in MY 2024/25 compared to this time last year. So far, South Korea is the top U.S. wheat buyer, with 389,500 MT booked, a significant increase from 45,300 MT the previous year. During the week of March 18, SW prices fell as low as $219/MT (according to the U.S. Wheat Associates Price Report) tracking the decreasing trend in the global wheat market. During this period, South Korean feed grain importers bought feed wheat cargos from the U.S., boosting their SW imports. However, according to Channy Bae, Country Director, USW/Seoul, this is a short-term opportunity for South Korean feed manufacturers and their purchases will shift relative to the price of corn and other origins.

The next largest new crop buyers to date are the Philippines, Mexico, and Japan with year over year increases of 348%, 30% and 83%, respectively. Likewise, buyers in Thailand and Panama have significantly outpaced their 2023/24 purchases, coming in at 239% and 336% higher. Some of the recent increases can be attributed to customers’ need for product and shipment cadence as well as customers taking advantage of more competitive pricing.

This bar chart demonstrates the increased U.S. wheat export sales pace to 10 countries to date in 2024 compared to the same period in 2023.

To date, South Korea, the Philippines, and Mexico are the top buyers of U.S. wheat. Year over year increases of 760%, 348%, and 30% have been recorded thus far. Buyers in Thailand and Panama have also significantly outpaced their 2023/24 purchases, coming in at 239% and 336% above last year’s level. Source: USDA FAS Export Sales.

Stay Tuned

Stronger early 2024/25 U.S. wheat sales come with one caveat. Traders identify farmer sales as a potential limiting factor moving into MY 2024/25. The lower wheat prices provide less incentive for farmers who use storage as a hedge to sell. The lack of liquidity limits the ability of exporters to aggressively price and market grain to meet the increased demand.

Looking ahead, the May 2024 World Agricultural Supply and Demand Estimates will offer additional insights on U.S. wheat production, exports, and global demand. Likewise, the weekly Commercial Sales Report will provide real time updates to the U.S. wheat sales pace. As always, U.S. Wheat Associates remains committed to offering information and support for buyers transitioning into the 2024/25 marketing year.

By Tyllor Ledford, USW Market Analyst

May 1, 2024/by Steve Mercer

Board of Directors, Japan

Coast to Coast: Team of Flour Milling Executives from Japan Hosted by USW in Arlington, Portland

USW President Vince Peterson and the USW Policy Team met with members of the Japanese Flour Millers Association (JFMA) for discussions at USW’s Arlington office.

Executives from top flour milling companies in Japan visited the Arlington, Virginia, office of U.S. Wheat Associates (USW) April 26. It was part of an annual trade mission seeking updates on the U.S. wheat crop and trade policy issues.

Starting in the Nation’s Capital

Made up of members of the Japanese Flour Millers Association (JFMA), the team also visited USDA offices. One stop included a meeting with Foreign Agricultural Service (FAS) Daniel Whitley. The East Coast visit included a stop at the Japanese Embassy in Washington, D.C.

The team then traveled to Oregon for a briefing from USW’s West Coast Office in Portland.

Valued Updates on U.S. Wheat

In Arlington, USW President Vince Peterson, Vice President of Policy Dalton Henry and Director of Trade Policy Peter Laudeman answered questions from some of U.S. wheat’s biggest customers. According to USW Japan Country Director Rick Nakano, the participating companies represent 80% of the Japanese wheat flour market.

“It is a trip that these executives look forward to each year because it offers them an opportunity to see many aspects of the U.S. wheat industry and discuss things face-to-face,” Nakano said. “The members return to Japan and share the things they learned in the various meetings.”

Henry said USW is always eager to provide updates and interact with JFMA members – be it in Japan or here in the U.S.

“The milling executives are always interested in U.S. wheat production and exploring our attitudes and opinions on biotechnology. This includes gene-edited wheat and drought-resistant wheat,” Henry said. “These are topics that get a lot of attention in ag media and other channels. So it’s important for us to have these in-person meetings to discuss what is happening. We are partners, so it is good to have these discussions on a regular basis.”

Mike Moran, Executive Director of the Wheat Marketing Center (WMC) in Portland, provides the team of Japanese flour millers with a tour of the WMC facility.

Moving on to the West Coast . . .

USW staff in Portland provided updates on the wheat crop in the Pacific Northwest. The Japanese team then had meetings with the Oregon Wheat Commission, and the Wheat Marketing Center (WMC). Visits with traders and exporters across the region followed.

At the WMC, Executive Director Mike Moran gave a tour of the facility. The group had the opportunity to learn about the different pilot lines in the WMC’s Innovation Lab, along with looks inside the Analytical Lab and Baking Lab.

The JFMA team returned to Japan on May 1.

“The team is very appreciative of the continued partnership and the support from U.S. wheat industry,” Nakano said as the Oregon portion of the visit ended. “We pack a lot into a short period of time, and there is a lot of travel, but the flour millers always leave the U.S. with a lot of good information to take home to their businesses.”

May 1, 2024/by Ralph Loos

Board of Directors, China, Vietnam

Video: Farmers on USW Board Team Witness the Important Role U.S. Wheat Plays in Vietnam, China

As a wheat farmer and dietician from Maryland, Jennie Schmidt found exploring flour mills and bakeries in Asia to be an intriguing adventure that came with plenty of “ah-ha” moments.

There is lots to be learned from meeting and talking to the people who buy and use U.S. wheat.

“It was nice to be able to see your product going into products both in Vietnam and in China,” Schmidt, who represented Maryland Grain Producers on the recent U.S. Wheat Associates (USW) Vietnam-China Board Team mission. “To see how wheat grown on our farms in the U.S. ends up as food for domestic consumption or for regional export markets helps paint the picture and show the value of international trade. It was also obvious they really like producing food products with U.S. wheat.”

Schmidt joined USW Secretary-Treasurer Jim Pellman of McClusky, North Dakota, and Mark Jossund of Moorhead, Minnesota, on the Board Team, which was led by USW West Coast Office Assistant Director Luke Muller.

Scenes from the group’s stops in both Vietnam and China can be seen in this brief video . . .

April 30, 2024/by Ralph Loos

Market and Crop Analysis, Tyllor Ledford, Wheat Production and Harvest

Articles of Interest – The Latest News About the U.S. Wheat Crop

Every weekday, U.S. Wheat Associates (USW) searches U.S. and global media for news about the U.S. wheat crop and the world wheat market. USW shares the news of the day as a service to our domestic stakeholders. The articles of interest on Monday, April 29, summarized below also have value for our overseas customers.

Wheat Market Rally

A market analysis article presented April 26 on “Farm Journal AgWeb” reached out to Allison Thompson of The Money Farm to describe a 7-day rally in U.S. wheat futures prices while corn and soybean futures declined. Thompson said concerns about dry conditions in the Central and Southern Plains hard red winter (HRW) region as well as southern Russia and western Canada sparked commercial investors to cover long-held short futures positions.

In the April 26 USW Price Report, Market Analyst Tyllor Ledford related news from traders that the futures rally did prompt farmers to sell old-crop wheat. Storms from April 26 to 28 sadly included a deadly, destructive tornado outbreak but also significant rain for some HRW and SRW production regions. So, early on April 29, HRW and soft red winter (SRW) futures were down. The precipitation missed much of western and south-central Kansas, eastern Colorado, and western Nebraska, however.

Image from USW Price Report page describes the latest information on US wheat export market and prices.

The April 26, 2024, USW Price Report noted that farmers increased sales of old crop HRW and HRS wheat during a recent rally in U.S. wheat futures prices.

Spring Wheat

Also on April 26, North Dakota Wheat Commission Director of Policy and Marketing Jim Peterson told “Farm & Ranch Guide” that there are both positive and negative price influences for U.S. hard red spring (HRS) wheat.

Jim Peterson

“On the positive note, it looks like an earlier planting season than a lot of other areas relative to the last few years, so that’s typically yield positive,” he explained. “The reason we’re seeing earlier planting is a lot of areas are abnormally dry to critically dry. If we don’t get a big shift in weather patterns here, we could see some early season moisture stress on the spring wheat region. Then we’ll see what happens with acres. Right now, the forecast is for unchanged total acres nationally, maybe up slightly,” he added.

Despite strong Canadian competition, Peterson said some demand fundamentals support the U.S. spring wheat market. Commercial sales of HRS as of April 25 were 13% ahead of a year ago at 6.40 million metric tons (MMT) and more than USDA’s projections.

Potential Wheat Supply Chain Disruption

Along with the farm and grain handling industries in the Pacific Northwest export system, USW is closely watching the political fight about the potential breaching of four dams on the Lower Snake River. An agricultural media company in the region with a website called AgProud.com published an interview about the debate with Scott Corbitt, General Manager of the Post of Lewiston in Idaho. In the interview, Corbitt describes the value of the port to the region and the overseas customers it helps serve.

U.S. grain handlers purchase wheat from farmers and transport approximately 24 million bushels (0.65 MMT) of wheat by barge through the Port of Lewiston every year, he said, and the companies barge 10% of total U.S. wheat exports through the Colombia Snake River System. Wheat exported from Idaho alone exceeds $300 million annually, Corbitt told AgProud.com. He added that breaching the Lower Snake River dams would result in a huge economic hit for the region disrupt the efficient flow of U.S. soft white (SW), HRS and HRW wheat to export elevators downstream in the Portland area.

Ice Harbor Dam on the Lower Snake River System in Washington state.

Read more information on the threat to barging on the Colombia Snake River System online here.

Eye on the Crop

“Capital Press” reporter Matthew Weaver recently wrote about how researchers at Washington State University have installed a wheat field camera at the university’s dryland research station in eastern Washington state. The still images taken several times a day of a spring SW wheat field can be viewed online at the research station website and on its YouTube channel.

A spokesperson for the station said the camera is a way for overseas and domestic wheat buyers, as well as non-farmers, to see how the crop progresses and to get more information about sustainable wheat production. The station plans to add short videos about the spring SW wheat crop to the service throughout the growing season and harvest.

The Washington Grain Commission, a long-time USW member organization co-sponsors the “WSU Field Cam.”

April 29, 2024/by Steve Mercer

Wheat Industry News

News and Information from Around the World Wheat Industry