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U.S. Wheat Supply Chain System: Farmers and State Wheat Commissions

By Michael Anderson, USW Assistant Director, USW West Coast Office

“Everywhere the grain stood ripe and the hot afternoon was full of the smell of the ripe wheat, like the smell of bread baking in an oven. The breath of the wheat and the sweet clover passed him like a pleasant thing in a dream.” – Willa Cather, O Pioneers!

Heading east out of Portland, Ore., the landscape changes quickly. From the large city you pass through a tapestry of green forest with snow-capped peaks in the distance. Following the Columbia River, the mountains gradually become smaller until opening onto vast open hills carpeted by wheat fields. It is an impressive drive and vastly different from where you started.

For U.S. wheat overseas customers visiting the U.S. Pacific Northwest states with a trade delegation, this is often the journey they take as they travel out to see for themselves where the wheat they purchase is grown and to meet the people who grow it. Every year, U.S. Wheat Associates (USW) and its state wheat commission member organizations host several trade delegations to facilitate these important connections. A crucial link that tightens the customer relationship, made possible by the long distances traveled, is to connect the customer with the source of their product in the company of the people who work hard to grow it.

Trade teams that visit the United States are often able to observe grain grading and inspection by the Federal Grain Inspection Service (FGIS). Visits can include interaction with research institutions to see how farmers and their state wheat commissions work closely with breeders to improve wheat varieties. Teams are often able to see the infrastructure that efficiently moves U.S. wheat from the farms to export facilities.

USW led five representatives of the Taipei Bakers Association and three officials from Taiwan’s Department of Public Health on a trade team to Oregon in late April 2019.

Customer Relations

Many U.S. wheat farmers and wheat commissions have made lasting connections with the customers they meet at part of trade delegations to and from the United States. Some have even had the opportunity to host customers they have met overseas here in the United States on their farms. In an interview with KGNC Radio in Amarillo, Tex., Ken Davis, a USW director and a wheat farmer from Grandview, Tex., talked about his experience traveling with USW. On a 2018 visit to Nigeria, Davis, who represents the Texas Wheat Producers Board, met with a team of flour millers and extended an invitation for them to visit his farm. A year later, he picked them up at the airport in Dallas and shuttled them to his farm. For the first time they got to see a wheat field and see the work that goes into growing the product that is crucial to their own livelihood. In the interview, Davis noted that “it is customer relations” that make the difference. That is a refrain I have personally heard often in my time with USW.

This trade team of Chilean flour millers that visited Oklahoma in June 2017 helped increase understanding of U.S. hard red winter wheat quality and how farmers do everything they can to produce the best quality crop.

Michael Peters, a wheat farmer from Okarche, Okla., and the 2020/21 USW Secretary Treasurer-elect representing the Oklahoma Wheat Commission, has his own experience to share. Last summer, at the USW Mexico Wheat Trade Conference, Peters saw a familiar face, César Enríquez, Director of Business Development for Grupo La Moderna in Toluca, Mexico. Enríquez extended an invitation for Peters to attend the opening of their new shuttle train facility. Later that fall, and to his surprise, Peters was there.

U.S. wheat farmers will continue to pursue a higher quality, wholesome and sustainable wheat crop by redefining the state of excellence every growing season. The U.S. wheat export supply system will continue placing an abundant supply of wheat for export, as it has continued to do during the COVID-19 pandemic. USW and its state commission members will also continue working to connect these farmers and the export system to customers around the world, both on their visits to the United States and abroad.

Read other blog posts in this series:
Research and Plant Breeding
Grain Handlers
Exporters, Inspectors and USW Overseas Offices

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Wheat Industry News

Recent news and highlights from around the wheat industry. 

Speaking of Wheat: “We see this transaction as the latest example of how working together and using technology to solve challenges can improve trade, as well as traceability, food safety, nutrition and more.” – Jennifer Davidson, Trade Execution Lead, Cargill, discussing a cross-continent wheat trade transaction on a blockchain platform. 

BLOG: Earth Day Celebrates 50 Years by Observing Climate Action. This year marked the 50th anniversary of Earth Day celebrated on April 22, 2020. The theme for Earth Day 2020 was climate action. Read the National Association of Wheat Growers’ (NAWG) recent blog highlighting some of the ways wheat growers are working to curb the effects of climate change. 

Corteva Opportunity: Genome Editing for Crop Improvement. As part of their effort and commitment to building strong partnerships, Corteva is inviting scientists from academic and nonprofit research institutions to submit brief, non-confidential proposals for gene edits that have the potential to improve wheat, maize (corn), soybeans, canola or sorghum. The application deadline is May 31, 2020. Click here for complete details. 

Farm Foundation Supports Young Farmers. The Young Farmer Accelerator Program is aimed at helping young farmers grow their knowledge, experience and network. The program will engage young farmers in a year-long series of interactive learning and networking experiences, focused on gaining a deeper understanding of a wide variety of agriculture, agribusiness and government issues.  

2020 National Wheat Yield Contest Entry Deadlines. The National Wheat Foundation is accepting entries for “Greater Grain. The National Wheat Yield Contest.”  The deadline for winter wheat entries is May 15 and the spring wheat entry deadline is August 1, with an early registration deadline of June 15. 

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

Follow USW Online. Visit our Facebook page at 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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Plans Being Made for Virtual Hard Red Winter Wheat Tour

For the first time in its 50-year history, the Wheat Quality Council (WQC) Hard Winter Wheat Tour has been cancelled this year due to the COVID-19 outbreak. U.S. Wheat Associates (USW) knows that its customers around the world look forward to the snapshot of new hard red winter (HRW) wheat crop yield potential the tour provides.

We want our customers to know that plans are being made to conduct a limited, virtual tour of the Kansas wheat crop during the week of May 18. Organizers are working with certified crop advisors, Extension agents, elevators, farmers and others in the field to make yield and quality observations of the crop and share information during the tour.

The organizers and USW will provide more information about the planned virtual hard winter wheat tour as soon as it is available. Stay tuned to #wheattour20 for future updates.

This week in Wheat Letter, USW Market Analyst Claire Hutchins shared information about challenges from freeze damage and increasingly dry conditions to the crop in the Central and Southern Plains. In addition, several state organizations report on new crop progress at the following links:

Colorado – https://coloradowheat.org/category/news-events/winter-wheat-crop-progress-report/

Kansas – https://twitter.com/KansasWheat/

Idaho – https://twitter.com/IdahoWheat

Montana – https://wbc.agr.mt.gov/Home/News

Nebraska – https://nebraskawheat.com/producers/crop-reports/

North Dakota – https://www.ndwheat.com/buyers/cropprogressreport

Oklahoma – https://twitter.com/OSU_smallgrains

South Dakota – https://sdwheat.org/

Texas – https://texaswheat.org/news-events/

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Dry Weather and Freezing Temperatures Challenge Hard Red Winter Wheat Crop

By Claire Hutchins, USW Market Analyst

The condition of the U.S. hard red winter (HRW) wheat crop is not improving. Farmers – and the markets – are concerned about the threats to yield potential from wide-spread April freezes and increasing dryness across a significant portion of the Central and Southern Great Plains.

USDA’s most recent crop condition ratings reflect the weather effects on the 2020-21 winter wheat crop, reducing the total crop rated good to excellent from 62 percent to 57 percent. According to Romulo Lollato, Kansas State University Wheat and Forages Specialist, drought weakens winter wheat’s ability to recover from freeze damage and both conditions challenge winter wheat yield potential. So the change in ratings is focused on the HRW crop, based on the worsening dryness in north central and southwestern Kansas, eastern Colorado and south central Nebraska. And this week, the extent of freeze damage is being monitored carefully in the following states.

Kansas.  Between April 20 and April 27, USDA reduced its Kansas winter wheat rating from 46 good to excellent to 40 percent as localized freezes and expanding dryness threaten crop progress.

“About 50 to 60 percent of the state’s wheat was impacted to varying degrees by freeze damage,” said Lollato. In north-central Kansas, several counties showed varying but considerable freeze damage. According to researchers at Kansas State University, the crop in that region needs moisture soon to help with freeze damage recovery. In parts of central Kansas, late-sown fields, following a soybean crop, showed severe leaf and tiller damage from recent freeze events. In parts of northwestern Kansas, dry soil conditions predisposed plants to freeze damage and in some cases severely damaged fields turned yellow and brown as plant tissue deteriorated. Southwest Kansas is still extremely dry and could impact the crop’s ability to recover from freeze damage. Looking ahead, hot, dry temperatures across the state could further challenge the crop’s ability to recover from freeze damage.

Late-sown fields in north central Kansas showed severe leaf and tiller damage from recent freeze events. Photos courtesy of Romulo Lollato.

Colorado. “Our story is dryness – we need rain,” said Brad Erker, Executive Director of the Colorado Wheat Administrative Committee.

Several weeks ago, USDA rated 54 percent of Colorado’s winter wheat in good to excellent condition. As of April 27, only 37 percent of the state’s crop is in top condition. Moderate to severe drought plagues the eastern third of the state, where the winter wheat is grown. There is little evidence yet that freeze damage has impacted the crop, but reports are still developing. Looking ahead, high temperatures and no moisture in eastern Colorado could continue to pressure the state’s yield potential.

The April 23 UNL Drought Monitor showed a significant expansion of abnormal dryness and severe drought across the Central and Southern Plains, with dry conditions expanding in North Dakota and the Pacific Northwest.

Nebraska. HRW conditions in Nebraska are better than in Kansas and Colorado, with 69 percent of the crop rated good to excellent. However, freezing temperatures impacted wheat across the state. According to Sarah Morton, Agriculture Promotion Coordinator for the Nebraska Wheat Board, temperatures close to 10 degrees Fahrenheit (-12 degrees Celsius) in Nebraska’s southern Panhandle “knocked the wheat back and turned it brown,” slowing growth. Freezing temperatures in southwest Nebraska also burned back the wheat. Adequate soil moisture levels and warmer temperatures in the western part of the state are expected to help the crop recover from recent freezes. On April 23, the University of Nebraska – Lincoln Drought Monitor introduced abnormal dryness into the south-central portion of the state.

Oklahoma. Reports from Oklahoma show significant freeze damage in some of the state’s southwest and south-central counties. Some counties in southwestern Oklahoma reported freeze damage across 40 to 70 percent of the crop. In several extreme cases, some areas in south-central Oklahoma showed freeze damage in virtually every field. The April 23 Drought Monitor expanded areas under abnormal dryness and severe drought in the Oklahoma Panhandle. As of April 27, 62 percent of the state’s HRW is in good to excellent condition, down from 65 percent the week before, with expectations that the condition will continue to deteriorate.

“It’s an extremely challenging time for southwestern Oklahoma producers,” said Mike Schulte, Executive Director of the Oklahoma Wheat Commission.

Header photo courtesy of Romulo Lollato.

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U.S. Wheat Associates Provides Comments on U.S.-Kenya Trade Negotiations

By Shelbi Knisley, Director of Trade Policy

U.S. Wheat Associates (USW) supports free trade through multilateral, regional and bilateral trade agreements. USW works closely with the USDA Foreign Agricultural Services (FAS) and the Office of the U.S. Trade Representative (USTR) to ensure favorable terms for wheat exports in all trade negotiations.

An opportunity to do that recently allowed USW to provide comments to USTR in support of negotiating a comprehensive Free Trade Agreement (FTA) with Kenya. That is because Kenya imports around 2.0 million metric tons (MMT) of wheat annually. Expanding market opportunities in Kenya would benefit U.S. wheat farmers and provide Kenyan flour millers with better access to quality supplies of milling wheat.

Map of Kenya. A detail from the World Map.

USW believes the negotiations should prioritize market access for U.S. wheat and resolution of sanitary-phytosanitary (SPS) issues and in our comments, we laid out these specific objectives:

  • Achieve an agreement with duty-free treatment and improved SPS and other non-tariff provisions for wheat of U.S. origin.
  • Eliminate Kenyan tariffs on U.S. wheat, which would create an advantage for U.S. wheat exports and help offset the shipping disadvantage currently faced by the United States compared to other suppliers, particularly between the European Union and Black Sea Region. Preferential access to Kenya would help make U.S. wheat shipments more competitive in the region.
  • Eliminate Kenya’s Certificate of Conformity requirement or Kenya should accept Federal Grain Inspection Service (FGIS) certificates and other standard trade documents as fulfilling that requirement, without requiring additional third-party inspections on U.S. wheat prior to shipment.

In February 2020 the U.S.- Kenya Trade and Investment Working Group adopted a phytosanitary protocol for Kenya that would allow U.S. wheat growers in the Pacific Northwest (PNW) access to Kenya’s wheat market for the first time in over a decade. Historically Kenya has maintained a non-scientific SPS barrier against U.S. wheat from this region due to concerns about the potential presence of a plant disease known as flag smut.

Africa is a rapidly growing continent, but one where the United States has had limited opportunities for trade negotiations. A high standard FTA with Kenya has the potential to serve as a model for other African countries to pursue trade agreements with the United States.

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Dependable People: A Spotlight on Maryland Grain Producers Utilization Board

For 40 years, U.S. wheat farmers have supported U.S. Wheat Associates’ (USW) efforts to work directly with buyers and promote their six classes of wheat. Their contributions to state wheat commissions, who in turn contribute a portion of those funds to USW, qualifies USW to apply for export market development funds managed by USDA’s Foreign Agricultural Service. Currently, 17 state wheat commissions are USW members and this series highlights those partnerships and the work being done state-by-state to provide unmatched service. Behind the world’s most reliable supply of wheat are the world’s most dependable people – and that includes our state wheat commissions.

Member: Maryland Grain Producers Utilization Board
USW Member since 2000

Location: Queenstown, Maryland
Classes of Wheat Grown: Soft Red Winter (SRW)
USW Leadership: Jason Scott, 2016/17 Chairman

The Maryland Grain Producers Utilization Board (MGPUB) works to increase the profitability of Maryland grain production and improve public understanding of agriculture through promotion, education and research.

Maryland wheat farmer Jason Scott (L) retired as 2016/17 Chairman and handed the gavel to 2017/18 Chairman Mike Miller, Washington wheat farmer (R), at the USW Summer Board Meeting in Annapolis, Md.

Why is export market development important to Maryland wheat farmers and why do they continue to support USW?

While Maryland has a large poultry industry in our state as an important customer for our grain, most of the soft red winter wheat grown here is primarily used to mill flour for cookies, pretzels and pastries. MGPUB recognizes that the export market is an important factor in supporting the commodity price for all farmers, including Maryland wheat growers.

How have Maryland wheat farmers recently interacted with overseas customers?

Maryland’s proximity to Washington, D.C. makes it a popular stop for farm tours for buyers and trade teams from different countries. In the last several years, Maryland has hosted trade teams and buyers from nearly twenty different countries showing them the quality of production methods and the soft red winter wheat grown in Maryland.

What is happening lately in Maryland that overseas customers should know about?

Maryland Grain Producers Utilization Board funds several projects focused on wheat quality and production through the University of Maryland. These research projects include “Improving Soft Red Winter Wheat Cultivars,” “Increasing Protein of Soft Red Winter Wheat,” and “Managing for Fusarium Head Blight.”

Maryland Grain Producers Utilization Board is also helps fund Maryland Farm & Harvest, a 30-minute, educational public television show that shares the good news story of farming with the public. Born from an idea at an MGPUB board meeting, the series is now an Emmy-winning, No. 1 rated local program, attracting an audience of over four million viewers.

Learn more about the Maryland Grain Producers Utilization Board on its website and on Facebook and Twitter.

Eric Spates, Maryland wheat farmer, traveled with USW on the 2017 Board team tour to Latin America, to visit U.S. wheat customers, including this one in Haiti.

Jason Scott (far right), Maryland wheat farmer and Past USW Chairman, joined USW for its 2019 Crop Quality Seminar Tour, visiting several countries in South America to share about the soft red winter wheat crop.

In 2014, a trade delegation from Brazil traveled with USW to the United States and stopped by Jason Scott’s farm in Maryland where they visited with several Maryland wheat farmers.

 

 

 

 

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U.S. Wheat Supply Chain System: Research and Plant Breeding

By Michael Anderson, USW Assistant Director, West Coast Office

Professional millers and bakers know that the appearance and taste of every product depends on the specific characteristics imparted by its flour ingredient. And those characteristics are deeply rooted in the ancient craft of plant breeding.

[Plant breeding is an ancient craft.] As far back as 10,000 years, farmers looked for traits that helped them grow more and better food. Egypt became the breadbasket of ancient Rome as its farmers adopted a type of wheat from the “fertile crescent” in modern Iraq to plant along the Nile River. Over time, the Egyptians found ways to grow a grain that was sturdy enough to transport long distances and stand up against pests. The Egyptian wheat traded with the Romans may not be what we are used to today, but the process for how it was grown to meet the needs of the consumer is by no means ancient history.

Today, the Wheat Genetics Resource Center at the Kansas Wheat Innovation Center houses more than 30,000 wheat varieties from around the world that are descendants of ancient varieties. Kansas Wheat Vice President of Research and Operations Aaron Harries likened the collection to a “treasure hunt,” offering the opportunity to find the next innovation derived in part from each specimen. Researchers and breeders here, and at other programs across the United States, play an important role in the relationship U.S. Wheat Associates (USW) builds with its customers. By listening to both farmer and customer feedback, they work on developing high-yielding, disease resistant wheat seed with excellent milling, baking and processing qualities.

Wheat Genetics Resource Center at the Kansas Wheat Innovation Center in Manhattan, Kan. Photo courtesy of the Kansas Wheat Commission.

Dr. Senay Simsek is a cereal chemist and professor at North Dakota State University and says that the personal connections that she has made on fifteen trips with USW to four different continents is crucial to her work. As an expert on hard red spring (HRS) wheat, Simsek says that when she prepares to meet overseas customers, she familiarizes herself with the types of wheat flour products they make, what the other ingredients are and what countries they buy wheat from. Being familiar with a market is important to understanding the unique needs of the customer. “Sophisticated” was the word she uses to describe customer needs and knowledge, emphasizing how important the technical process of using the right wheat for a specific product can be.

Dr. Senay Simsek joins USW staff to meet with U.S. wheat customers in Indonesia in 2019.

Dr. Senay Simsek joins USW staff to meet with U.S. wheat customers in Malaysia in 2019.

Each year, USW hosts several trade delegations that are traveling to the United States to learn firsthand about the U.S. wheat supply chain system. The delegations visit research institutes like the USDA Western Wheat Quality Lab at Washington State University in Pullman, Wash. Its mission in part is to “conduct cooperative investigations with breeders to evaluate the milling and baking quality characteristics of wheat selections,” and to “conduct basic research into the biochemical and genetic basis of wheat quality in order to better understand the fundamental nature of end-use functionality.” The director of the lab, Dr. Craig Morris, welcomes many of the USW delegations to his lab each year and emphasizes the unique partnership that the lab, as part of the USDA Agricultural Research Service, has within the industry, among other researchers and with state wheat commissions.

A USW Japanese trade delegation visits the USDA Western Wheat Quality Lab.

In September 2019, I had the opportunity to visit Washington State University with a trade delegation from Southeast Asia. We met with Dr. Michael Pumphrey, a spring wheat breeder, who walked us through the steps of the wheat breeding process. We watched as he cross-pollinated single wheat plants, a process that requires careful, precise techniques.

In his 27 years with USW, Steve Wirsching, Vice President and West Coast Office Director, based in Portland, Ore., has hosted many trade delegations and has also led many Wheat Quality Improvement Teams of wheat breeders to visit customers overseas. When asked why USW continues to put an emphasis on facilitating the relationships between customers and wheat researchers and breeders, he said, “It is important to listen to our customers and seek feedback on the quality characteristics they need. It is part of the U.S. Wheat Associates mission, to enhance wheat’s value for our customers.”

2017 Wheat Quality Improvement team in Thailand. Read more about this activity.

2018 Wheat Quality Improvement Team in Latin America. Read more about this activity.

According to www.innovature.com, the innovation and evolving breeding methods in agriculture and food, and a deep understanding of DNA, today helps scientists like Dr. Simsek and Dr. Pumphrey make even more precise genetic changes to wheat and other plants. Their work is needed more than ever to meet some of society’s most urgent and pressing challenges including climate change, sustainability, hunger and improved health and wellness.

Read other blog posts in this series:
Farmers and State Wheat Commissions
Grain Handlers
Exporters, Inspectors and USW Overseas Offices

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Wheat Industry News

Recent news and highlights from around the wheat industry. 

Speaking of Wheat: “Despite all the disruption the coronavirus epidemic is causing the United States, the food supply system is working well. Disruptions are largely limited to changes in demand (such as hoarding), as opposed to challenges to supply. There is zero reason to expect the United States to need to bar food exports,” – Peter Zeihan, April 15, 2020, “Coronavirus: The American Food Security Guide.” Copyright © 2020 Zeihan on Geopolitics. All rights reserved. 

Congratulations to our Western Canadian Wheat Growers Association friends celebrating the organization’s 50th anniversary in 2020. The WCWG has produced a commemorative book, “Warriors For Wheat,” illustrating its active engagement in Canadian agriculture policy on behalf of its farmer members. 

USW is Sad to Learn that Ben Handcock has passed away after a long illness. Ben directed the Wheat Quality Council for 25 years. Dave Green, who now directs the Council, called Ben “a true friend of the industry and a close personal friend to many of us.” On his retirement in 2017, USW thanked Ben for all he had done for wheat farmers and the amazing experiences shared on WQC tours. Our sincere sympathy goes out to his wife Patsy and their family. 

USDA Releases April WASDE Report. The World Agricultural Supply and Demand Report showed an increase in wheat stocks and a reduction in expected 2019/20 (June to May) U.S. exports to 26.8 MMT on slower late year sales pace and higher prices compared to other exporters.   

2020 National Wheat Yield Contest. On February 18, the National Wheat Foundation (NWF) officially opened the 2020 National Wheat Yield Contest. Farmers can submit entries in winter wheat and spring wheat with subcategories for dryland and irrigated. NWF is accepting entries for winter wheat until May 15 and entries for spring wheat from June 15 to August 1. 

New Tool to Combat Major Wheat Disease. USDA/Agricultural Research Service (ARS) scientists and their colleagues have discovered a gene that can be used to develop wheat varieties that will be more resistant to Fusarium Head Blight (FHB) or scab, a disease that is a major threat both overseas and to the nation’s $10 billion annual wheat crop. Collaborating scientists from the United States and China published a paper reporting the discovery recently in the journal Science.

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

Follow USW Online. Visit our Facebook page at 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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Dependable People: A Spotlight on the Oklahoma Wheat Commission

For 40 years, U.S. wheat farmers have supported U.S. Wheat Associates’ (USW) efforts to work directly with buyers and promote their six classes of wheat. Their contributions to state wheat commissions, who in turn contribute a portion of those funds to USW, qualifies USW to apply for export market development funds managed by USDA’s Foreign Agricultural Service. Currently, 17 state wheat commissions are USW members and this series highlights those partnerships and the work being done state-by-state to provide unmatched service. Behind the world’s most reliable supply of wheat are the world’s most dependable people – and that includes our state wheat commissions.

Member: Oklahoma Wheat Commission
Member of USW since 1980

Location: Oklahoma City, Oklahoma
Classes of wheat grown: Hard Red Winter (HRW), Hard White (HW)
USW Leadership: Don Sherrill, 1988/89 Chairman; Henry Jo Von Tungeln, 2001/02 Chairman; Keith Kisling, 2004/05 Chairman; Don Schieber, 2010/11; Michael Peters 2020/21 Secretary-Treasurer-elect (slated for 2022/23 Chairman).

Established in 1965, the Oklahoma Wheat Commission promotes greater utilization of wheat in domestic and international markets through research, market development and public education. Twenty percent of all producer funds collected by the Commission are allocated to the Oklahoma Wheat Research Foundation. The Commission supports numerous wheat research projects conducted by the Oklahoma State University Division of Agricultural Sciences and Natural Resources, all aimed at ensuring the future of Oklahoma wheat.

2020-21 USW Officers (L to R): Michael Peters, Oklahoma; Rhonda Larson, Minnesota; Darren Padget, Oregon; Doug Goyings, Ohio; Vince Peterson, USW.

Why is export market development important to Oklahoma wheat farmers and why do they continue to support USW?

Export markets are critical to the success of U.S. agricultural products because it allows us to capture value for the U.S. farmer in markets that might not be able to grow crops such as wheat. We continue to face greater competition from Russia, Canada, the European Union, Australia and other countries that also grow wheat, so it is extremely important for us to continue offering technical assistance to millers and bakers overseas. Demonstrating the benefits of U.S. wheat and why it is the most reliable choice for their products is important. If we do not tell the story about U.S. wheat value, nobody will. We must also continue working on quality analysis and research that offers the best value to our foreign buyers.

The Oklahoma Wheat Commission host Grupo Trimex in 2016 at Sidwell Farms in Northwest Oklahoma. From left to right are: Eric Vandebrouck, Grupo Timex; Luis Cortes Velasco, Grupo Trimex; Brady Sidwell, Sidwell Farms; Mike Schulte, Director of the Oklahoma Wheat Commission; Mark Hodges, Director of Oklahoma Genetics Inc. & Plains Grains Inc.; Kenneth Failes, OWC Board Member District I; Chad Weigand, USW Mexico City and on the tractor Hector Martinez Gonzalez, Grupo Trimex.

How have Oklahoma wheat farmers recently connected with overseas customers?

Mexico is the largest market for Oklahoma wheat and the relationships created between Oklahoma wheat farmers and Mexican flour millers over the past 30 years are greatly valued. This last year we have worked with Oklahoma State University (OSU) and the Wheat Marketing Center (WMC) in Portland, Ore., to focus on functionality studies for products like tortillas for the Mexican market. While traditionally our focus has been on Latin American, African and Middle Eastern export markets, we have also recently shifted some focus to Far Eastern markets, specifically China and Taiwan. Based on feedback from a visiting Taiwanese trade delegation in 2019, we are working on HRW and HW functionality studies for steam breads and Asian noodles. In the past, HRW wheat was not used for these types of products but we have seen Taiwanese customers react to technical assistance offered by U.S. Wheat Associates, WMC and on-going research at OSU. This past year Taiwan has sourced HRW to make up 30 percent of their production blends, or about 16 million bushels of U.S. HRW purchased over the last three months. In March, China also purchased 12.5 million bushels of HRW for the same blending purposes. These purchases are particularly important because it showcases the value of HRW for blending due to advancements in quality. Renewed Chinese purchases are a positive signal that the new Phase One U.S.-China trade agreement signed in January 2020 is working.

The Oklahoma Wheat Commission hosted a Chilean delegation in 2017 at their new offices: From left to right are Eduardo Bustamante, Grupo 9; Sergio Morales, Molino San Cristobol; Casey Chumrau; USW Santiago; Tom Stephens, OWC Board Member, District 2; Jose Eugenio Grohnert, Molino La Estampa; Juan Enrique Ojeda, Molinos Cunaco; Michael Peters OWC Board Member, District 3; Mike Schulte, Executive Director of the OWC; and David Gammill, OWC Board Member, District IV.

What is happening lately in Oklahoma that overseas customers should know about?

Our current focus is on end-use quality characteristics for the functionalities that our overseas customers need for many different end products. Traditionally Oklahoma is known for growing HRW wheat for bread consumption, and while that continues to be a significant part of our role in domestic and international markets, our focus is changing to meet changing consumer demands. We are trying to create products that can be prepared in a matter of minutes rather than products that take 30 minutes to an hour. We are seeing consumer preferences change across the globe. People want meals to taste good, but they also want them to be easy and quick to make. We certainly are seeing greater emphasis on tortilla demands and we expect to see more emphasis on steam breads that can be utilized for several different cooking purposes.

Learn more about Oklahoma Wheat Commission on its website here and on Facebook and Twitter.

 

Taiwan Flour Millers Association members are hosted by Don and Cecelia Schieber on their family farm in Kildare. Representatives and flour companies involved on this delegation tour with Taiwan Flour Millers Association included Mr. Bo-Yuan Chen, Country Director Taipei Office, U.S. Wheat Associates; Mr. YuMin Cho, Executive Assistant, Hsin Chu Flour Mill Co., Ltd.; Mr. Peter CY Chen, Director General of the Taipei Economic Cultural Office in Houston; Ms. Stacey H.C. Lin, Taipei Economic and Cultural Representative Office; Mr. Tony Yi-Cheukn Shu, Executive Director, Taiwan Flour Mills Association, President Formosa Oilseed Processing Co., Ltd.; Mr. Charles C.K. Hung, General Manager of Chia Fha Enterprise Co., Ltd.; Ms. Chih-Ping Chen, International Trade Assistant, Ta Fong Flour Mill Co., Ltd.; The Honorable Roland Pederson, Oklahoma State Senator, District 19; Mr. Tsung-Yuan Lin, Assistant to General Manager, Hon Hsing Flour Mill Co., Ltd.; Mike Schulte, Executive Director of the Oklahoma Wheat Commission, and Benjamin Hsu, Taipei Economic Cultural Office in Houston.

In 2014, Don Schieber, Oklahoma wheat farmer and past USW Chairman welcomed Anna-Mart Rust, a customer from South Africa to his farm during a USW trade delegation tour. In 2018, Don and Anna-Mart reconnected in South Africa while Don was traveling with USW on a board team trip.

 

Oklahoma Wheat Commission Executive Director Mike Schulte participated in the USW food aid trip to Tanzania in 2017.

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COVID-19 Changes Global Wheat Trade Dynamics

By Claire Hutchins, USW Market Analyst

It is no secret that these are uncertain times. As countries across the world work to contain and combat the novel coronavirus (COVID-19) outbreak, U.S. Wheat Associates (USW) is closely monitoring the effects of the outbreak on global wheat trade dynamics. Over the past several weeks, several major wheat exporters have implemented measures to curb 2019/20 wheat exports to stabilize domestic prices amidst greater demand uncertainty—spurring upward price movement across the world. In its April World Agricultural Supply and Demand report, USDA updated its global wheat trade estimates to reflect new policy and price dynamics.

Russia. Between March and April, USDA reduced its total Russian wheat export forecast for 2019/20 by 4 percent to 33.5 million metric tons (MMT), 7 percent less than last year, if realized, on the news of potential grain export restrictions for the remainder of the marketing year. In late March, Russia’s Agriculture Ministry proposed a 7.0 MMT quota on the country’s grain exports between April and June to stabilize prices and protect food security during the COVID-19 pandemic. Despite USDA’s reduced Russian wheat export estimate, members of the grain trade believe the quota will not have a serious impact on the country’s grain exports. During the same period last year, Russia exported a total 4.90 MMT of all grain, well below the quota threshold. According to a Russian grain trader interviewed by AgriCensus, “I think some 4.5 to 5.0 MMT of wheat exports between April and June were expected … so a 7.0 MMT quota is not dramatic.” Between March 19 and April 12, according to AgriCensus, Russian FOB prices for 12.5% protein wheat (on a dry moisture basis) increased 10 percent from $208/MT to $229/MT.

Ukraine. During the week of March 27, Ukrainian millers and bakers asked the government to limit grain exports and related products to maintain domestic bread prices during the coronavirus pandemic. According to Reuters, Ukraine’s economy ministry said it would control wheat exports, sell flour on the domestic market and agree with traders on a maximum volume of exportable wheat. UGA, Ukraine’s major trader’s union agreed with an economy ministry proposal to limit the country’s 2019/20 wheat exports to 20.2 MMT, 26% higher than last year, if realized. USDA’s total 2019/20 Ukrainian wheat export forecast is unchanged month-over-month at 20.5 MMT. By April 8, Ukraine’s total grain exports reached a record 47.0 MMT, 18.1 MMT of which is wheat, up 21% on the year.

Romania. On April 10, Romania’s government issued a military decree banning cereal and other food exports including wheat to non-European Union destinations during a state of emergency, expected to last until mid-May, in response to the COVID-19 pandemic. Romania is a key origin for Egypt’s General Authority for Supply Commodities (GASC) and the unexpected absence of Romania from the global market supported prices between GASC’s February and April tenders. On April 14, GASC bought 120,000 metric tons (MT) of Russian wheat at $240/MT FOB, 5 percent more expensive per metric ton than its February 11 tender when it bought 180,000 MT of Romanian wheat at $228/MT FOB. According to a European grain trader interviewed by Reuters, “There is not much 11.5% or 12% protein (dry matter basis) left in big volumes of 60,000 MT in Russia and Ukraine while Romania is temporarily out of the game.”

European Union, Other. To date, besides Romania, other countries in the EU have not implemented wheat export restrictions. According to USDA, European Union (EU) wheat exports have surged in the past month on ample supplies and competitive prices. In France, the EUs’ top wheat-producing country, total wheat exports in 2019/20 now stand at 8.0 MMT, 12% greater than this time last year. USDA expects total EU wheat exports will reach 31.0 MMT this marketing year, 25% greater than last year and 7% greater than the 5-year average.

 

United States. The U.S. grain export industry and the government agencies that protect and promote U.S. agriculture are working to ensure continuous trade flows despite market uncertainty during COVID-19. As of April 2, U.S. wheat export sales to date total 25.0 MMT, up 2 percent from last year. On April 9, USDA reduced its 2019/20 U.S. wheat export estimate from 27.2 MMT to 26.8 MMT, still 5% greater than last year and 9% above the 5-year average, if realized. Seasonally slower export sales and higher U.S. wheat export prices through the last half of March pressured USDA’s total U.S. wheat export forecast month-over-month. Heightened domestic demand and large hard red winter (HRW) sales to China supported U.S. export prices between mid-March and early April.

Under these unprecedented circumstances, USW is doing everything it can to continue to promote the reliability, quality and value of all six U.S. wheat classes to our overseas customers. USW encourages our customers and stakeholders to reach out to our colleagues by telephone or email. We are ready to provide the information our customers need about U.S. wheat supplies or market factors, or to answer any marketing and processing questions that may arise. Another option is to submit a question to our “Ask the Expert” page on our website at https://www.uswheat.org/market-and-crop-information/ask-the-expert/.

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