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By Philip Brasher, Executive Editor, Agri-Pulse

Copyright © 2019, Agri-Pulse Communications, Inc., Excerpted with Permission

 

Crop developers say USDA’s effort to streamline its regulation of biotech crops will still slow the commercialization of many gene-edited products, but groups representing grain traders, food processors and restaurant chains are slamming the department’s proposal, claiming it could lead to trade disruptions and undermine consumer confidence.

 

Under the proposed rule issued in June, bioengineered plants would be exempted from regulation by USDA if the modifications could be produced through traditional breeding techniques, making them unlikely to pose a greater plant pest risk than conventionally bred crops.

 

Crop developers would have three options under the proposed rule: They would be allowed to decide on their own whether their modifications are exempt from regulation; Companies could seek confirmation letters from USDA of the exempt status; Or they could ask USDA to determine whether the trait is regulated or not.

 

The National Grain and Feed Association, Corn Refiners Association, National Oilseed Processors Association, North American Export Grain Association and North American Millers Association said in a joint statement to USDA that the proposal is “fundamentally flawed and is inconsistent with the agency’s obligation to protect the economic value of U.S. agricultural and food exports.”

 

Other food industry groups, including the Grocery Manufacturers Association, National Restaurant Association and American Bakers Association, joined the grain industry on a shorter statement that said the proposal also risked undermining consumer confidence.

 

“If USDA is unable to inform consumers on what is available in the market, it is likely that consumer confidence in USDA will wane. Additionally, we believe the proposed regulatory framework opens the door for significant criticism of APHIS and genetic engineering technologies,” the statement said.

 

The groups called on USDA to slow implementation of the changes to its regulatory system until the Food and Drug Administration and Environmental Protection Agency issue rules or guidance on how they plan to oversee gene-edited crops.

 

Tuesday was the deadline for industry organizations, advocacy groups and the public to file comments on a proposed rule issued in June to rewrite USDA’s Part 340 regulatory process for genetically engineered plants.

 

The Biotechnology Innovation Organization (BIO) and American Seed Trade Association urged USDA’s Animal and Plant Health Inspection Service to expand the proposed regulatory exemptions, which are based on the concept that modifications that could be achieved through “traditional breeding techniques” should not require USDA approval. The four exemptions include modifications achieved solely through the deletion of genetic material or through single base pair substitutions.

 

The American Seed Trade Association says “significant applications of genome editing” could fail to qualify for the proposed exemptions. The group said the exemptions should cover a range of genetic changes that have been traditionally made through mutations, sometimes with chemicals or radiation.

 

More than 3,200 crop varieties, from heat-tolerant cotton to Ruby Red grapefruit, have been bred since the 1950s through induced mutations, the group said.

 

Plants modified through mutations induced by chemical means or radiation can be used in organic production.

 

BIO said, “Techniques commonly used by plant breeders today are capable of creating a much broader array genetic modifications than the limited exemptions proposed.”

 

Nina Fedoroff, a molecular biologist who served as the State Department’s science and technology adviser during the George W. Bush administration, agreed that the exemptions were too limited.

 

“The kinds of modification that can be made through traditional breeding, which now defined to include chemical and radiation mutagenesis, cover a much larger array of genetic changes than is included in the detailed list of exemptions listed in the proposed rule,” wrote Fedoroff, who is a science adviser in the Olsson Frank Weeda Terman Matz law firm.

 

But the groups representing grain traders and processors argued that USDA hasn’t provided scientific justification for the exemptions in the proposed rule and that the self-determination approach “risks undermining consumer acceptance and international regulatory recognition of APHIS’s regulatory oversight.”

 

The biotech industry acknowledged that USDA should require some form of mandatory notification. BIO, which represents a wide range of biotech companies, said breeders should be required to file a notification, which would include details of why it is exempt from regulation, at least 90 days before putting the product on the market. The information would later be posted on an agency website. The notification requirement would apply to a product that a developer self-determines to be exempt, not just to those products for which the developer seeks formal confirmation from USDA that it is exempt.

 

“BIO looks forward to working with the Agency on implementing guidance that achieves transparency without limiting innovation in either commodity or specialty crops,” the group said in its 43-page filing with APHIS.

 

ASTA also supports mandatory notification, although the industry is still debating what the requirements should be, said ASTA President Andy LaVigne.

 

The National Corn Growers Association cautioned the agency to consider how a mandatory notification system “might be perceived in international markets” and whether and how the notification process would “hinder global acceptance” of biotech products.

 

The National Association of Wheat Growers, which also is concerned about protecting its export markets, called on the federal government to “actively engage with our trading partners as soon as possible to work toward consistent, science-based policies across countries to avoid trade disruptions.

 

“All foreign customers expect the continued oversight by USDA to ensure consistent food safety, which is fundamental to their confidence in purchases of U.S. wheat,” the group said in its comments, noting that half the wheat American farmers grow is sold for export.

 

The vast majority of the more than 5,400 comments that have been posted online so far have been critical of the administration for seeking to streamline biotech regulations.

 

The Center for Science in the Public Interest, a consumer advocacy group that is generally supportive of agricultural biotechnology, also thinks USDA is going too far in deregulating the products.

 

CSPI specifically opposes allowing companies to self-determine whether their products are subject to regulation and says the proposed exemptions are too expansive, not too narrow, as BIO, ASTA and Fedoroff argue.

 

The proposed rule would eliminate USDA oversight of many ‘traditional’ plants that are genetically engineered, “which could result in harm to human health, the environment, and/or U.S. agricultural interests. We are also concerned that many of the proposed exemptions from oversight are not supported by the necessary scientific data and analysis that would ensure they will not result in adverse impacts,” CSPI said in its comments.

 

The group goes on, “U.S. consumers and trading partners will not accept unregulated GE products unless the basis for exempting oversight is based on scientific evidence.”

 

An advocacy group that has long fought USDA in court over biotech regulation, the Center for Food Safety, claims in its comments that the exemptions would “drastically shrink the scope of regulation to a small subset” of genetically engineered organisms.

 

“This exemption scheme is arbitrary and capricious, and contrary to sound science, because as APHIS itself concedes, it is impossible to determine whether a specific GE modification on a specific plant could in fact have been effected by means of traditional breeding techniques,” CFS says.

The organization contends the exemption criteria are so explicit that crop breeders won’t bother to consult with APHIS on whether their products are regulated.

A USDA official said recently that the department should be on track to finalize the regulatory changes in mid-2020.

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Recent news and highlights from around the wheat industry.

Quote of the Week: “Trade policy throughout the past several decades has opened up new markets for agricultural exports, increased access in existing markets, and lowered or eliminated various tariffs and technical barriers to trade. Opportunities for improvement still abound; however, the benefits far outweigh the drawback for the agricultural community.” – Michelle Erickson-Jones, Wheat Farmer and Past-President of the Montana Grain Growers Association. Click here to read more.

Weekly Commercial Sales are Up. USDA reported net U.S. wheat export sales of 487,700 metric tons for the week to August 1. That is 27% higher than the preceding week and 17% above the prior four-week average. U.S. Wheat Associates (USW) publishes a Commercial Sales report every Thursday with more details.

USDA Should Consider Export Customer Concerns. This week, the National Association of Wheat Growers (NAWG) submitted comments to the U.S Department of Agriculture on proposed rule changes to regulations on plant biotechnology. In a statement about its comments, NAWG said: “… its highest priority concern is that any rule change contemplated by the USDA APHIS needs to consider its impact on importing countries of U.S. produced grain. NAWG encourages USDA APHIS to develop and execute an international engagement strategy that defines USDA’s rationale on pre-market regulatory approaches. All foreign customers expect the continued oversight by USDA to ensure consistent food safety, which is fundamental to their confidence in purchases of U.S. wheat.” Click here to read the entire statement.

No Vote on USMCA “Disappointing.” In a news release, the Washington Grain Commission (WGC) and the Washington Association of Wheat Growers (WAWG) said the failure of the U.S. Congress to approve the U.S.-Mexico-Canada Agreement on Trade (USMCA) prior to its August recess “jeopardizes trade with two of America’s most reliable customers as it threatens wheat shipments to our most important market.” They urged Congress to schedule an expedited vote on the important trade agreement. Although the Pacific Northwest exports little grain to Mexico, wheat is traded on the world market and undermining exports to Mexico “will depress prices further for all wheat farmers” the organizations stated.

IAOM-KSU Basic and Advanced Milling Principles. Through hands-on training in the Kansas State University milling facilities and classroom discussions at the IGP Institute, these two courses will further develop participants basic and advanced milling skills and understanding of the milling process. The IAOM-KSU Basic Milling Course will be held Oct. 7 to 11, 2019. Click here for more information about these courses and the IGP Institute.

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 page at https://www.facebook.com/uswheat for the latest updates, photos and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter at www.twitter.com/uswheatassoc and video stories at https://www.youtube.com/uswheatassociates.

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By Claire Hutchins, USW Market Analyst

Extremely high temperatures and below-average precipitation levels prompted USDA to reduce its Russian wheat production forecast from 78.0 million metric tons (MMT) in its June World Agricultural Supply and Demand Estimates (WASDE) report to 74.2 MMT in its July WASDE report. That is a 5% reduction month over month. Russia’s leading agriculture consultancies also reduced their Russian wheat production forecasts. Between June 11 and July 24, SovEcon reduced its 2019/20 Russian wheat production forecast by 10% from 82.2 MMT to 73.7 MMT. Between early June 12 and August 5, IKAR reduced its Russian wheat production estimate by 6% from 80.2 MMT to 75.5 MMT.

All sources point to lower Russian wheat production, but SovEcon and IKAR differ in how they see reduced exportable supplies affecting Russian export prices. Despite reducing its wheat production forecast, SovEcon estimates “Russia’s wheat crop issues are not big enough to impress the market.” Accordingly, it quoted Russian FOB values for 12.5 protein wheat (equal to 11.0 protein on a 12% moisture basis) at $197/MT on July 29 and at $195/MT on August 2. IKAR, on the other hand, believes the country’s reduced exportable supplies contribute to rising FOB values. According to IKAR, Russian FOB values for 12.5 protein wheat rose from $193/MT on July 23 to $196/MT on July 30.

How should these price differentials be interpreted? A look at recent tenders from Egypt’s state commodity-procurement agency, the General Authority for Supply Commodities (GASC) provides some insight. Through GASC, Egypt publicly offers to purchase wheat in set amounts from global exporters. Grain trading companies source wheat from multiple origins to bid on the GASC tenders, vying to offer the lowest FOB prices available. The tender results are available to the public, offering a clear picture of current export prices by origin source.

Often, conditions affecting exportable supplies in the Black Sea are apparent in GASC tender results. For instance, between May and July 2018, USDA reduced its Russian wheat production forecast by 7% on abnormally wet conditions affecting spring wheat planting and abnormally dry conditions affecting winter wheat areas. In 2018, for example, Black Sea supply concerns made their way into GASC’s tender results. On June 12, 2018, Russia’s lowest offer at the GASC tender was $209/MT FOB. By August 2, 2018, Russia’s lowest offer reached $235/MT FOB as supply concerns worsened.

While Russian 2019/20 wheat production is expected to increase 3% over 2018/19 levels to 74.2 MMT, its exportable supplies (beginning stocks plus production minus domestic consumption) are expected to fall 2.0 MMT from last year to 49.0 MMT in 2019/20. This year’s weather challenges are again present in recent Egypt’s GASC tender results. Between June 11 and August 6, the lowest FOB offer Russian wheat increased 4% from $197/MT to $204/MT. It is worth noting that the August 2 U.S. Wheat Associates (USW) Price Report estimated Gulf FOB export price for U.S. hard red winter (HRW) with equivalent protein for September delivery at $205/MT.

U.S. Wheat Associates (USW) believes these price trends could continue if hot, dry conditions persist across Russia’s predominant wheat growing regions.

Every month, USW publishes a graphic summary of the latest data from USDA’s WASDE report, including global wheat market factors, major country and regional export history and U.S. wheat supply and demand summaries by class. View the monthly summary here.

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Colombia’s flour milling industry depends on imported wheat and is separated into regional clusters by the location of Colombian ports. Wheat arriving in Buenaventura on the Pacific coast is trucked to flour mills in Cali and Bogotá to serve the country’s largest regional baking industry. Much of the wheat unloaded at Buenaventura, however, is Canadian Western Red Spring (CWRS). That is because the price and discounting tactics of the now defunct Canadian Wheat Board helped built a traditional preference for CWRS. Bakers in Cali and Bogotá, in turn, learned to mellow this strong flour with additives; logistics kept them from seeing an alternative in U.S. hard red winter (HRW).

USW’s representatives in South America saw an opportunity to change that, at first by showing a large, influential bakery in Bogotá the value of using flour from excellent quality HRW. Through the second half of 2018, USW Regional Director for South America Miguel Galdos made in-person trade servicing calls to the bakery. In early 2019, the bakery agreed to USW’s proposal to bring in a baking consultant to demonstrate an alternative baking method, sponge and dough, using flour milled from HRW.

The consultant compared the alternate method to the bakery’s standard method using flour milled from Canadian spring wheat with additives. The results in the most popular Colombian bread products and new products (functional breads, sweet breads) were very good using flour blended from at least 40% HRW and 60% CWRS with no additives. The HRW flour blend improved mixing and fermentation, dough characteristics and machine processing without hurting finished product volume and appearance. The bakery’s management decided to adapt the HRW blended flour immediately.

Galdos reported that because there was no HRW blended flour available from their Bogotá suppliers, the bakery contacted a flour mill in Cartagena because U.S. HRW and other classes were moving into Colombia through its northern Caribbean ports. The mill’s representative flew to Bogotá and Galdos reports that the mill now has a new customer purchasing flour milled exclusively from U.S. HRW.

USW recently demonstrated a similar comparison at another bakery in Medellin, Colombia, to help build a larger data base of performance benefits with HRW flour. Looking ahead, USW is sharing the benefits of the HRW blend alternative with flour mills in Cali and Bogotá and their bakery customers. The long-term goal is to increase demand for U.S. HRW to be imported through Pacific ports. USW believes this will also help create new opportunities in the Bogotá market for U.S. soft white (SW) for blending and pastry flour, and hard red spring (HRS) delivered to Colombia’s Pacific ports now dominated by Canadian spring wheat.

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Original news release by the National Association of Wheat Growers published here.

The Senate Committee on Agriculture held a hearing July 31, 2019, looking at perspectives around reauthorizing the Grain Standards Act. Brian Linin, a wheat farmer from Goodland, Kan., testified on behalf of the National Association of Wheat Growers (NAWG) on the importance of reauthorizing the Grain Standards Act. Linin also serves as a board member of the U.S. Wheat Associates and works for Frontier Ag, Inc.

Highlights from his testimony can be found below:

“The Grain Standards Act serves a critical role in exporting grains and oilseeds, including U.S. wheat, of which about 50% is exported each year. With such a large volume of wheat being exported, our export markets are critical to wheat farmers’ bottom lines…”

“The grain inspection system is one that is valued by our overseas customers and adds value to our commodities. Foreign customers can be assured that an independent agency has certified shipments to meet the grade requirements specified in a contract. This certainty and reliability has helped wheat and other U.S. commodities to grow our export markets and serves as a significant advantage of purchasing U.S. wheat versus wheat from other origins…”

Brian Linin and Senator Pat Roberts (KS).

“A properly functioning grain inspection system is critical, and we urge Congress to reauthorize the Grain Standards Act this year. Despite the significant impacts of tariffs on exports, U.S. wheat has maintained some competitiveness in the international market in part thanks to the advantage and premium international buyers place on the U.S. grain inspection system.”

“Given the current uncertainty in trade agreements and many of the bearish factors working against U.S. wheat exports, it is critical we maintain one of our key advantages. Foreign and domestic customers value an independent agency certifying shipments to meet the grade requirements of contracts.”

To read Brian Linin’s testimony in its entirety, visit NAWG’s site here.

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Under the Agricultural Trade Promotion (ATP) program administered by USDA’s Foreign Agricultural Service (FAS), U.S. wheat farmers recently welcomed additional support for the effort to build overseas demand for the high-quality wheat they produce.

FAS awarded $8.2 million to U.S. Wheat Associates (USW) in cost-share assistance in May 2019 and awarded an additional $2.6 million on July 19 earmarked for wheat export promotion through September 2022. To apply for the funding USW was required to demonstrate that wheat farmers were hurt by import barriers laid down as a result of trade disputes. In 2018, USW reported that farmers had experienced losses of more than $330 million as a result of China’s retaliatory tariffs on wheat and a slow down in imports by Mexico.

José Luis Fuente, President of Camara Nacional de LA Industria Molinera de Trigo (CANIMOLT) at the USW Mexico Wheat Trade Conference, June 2 to 4, 2019.

USW will do all it can to use these additional resources as effectively as possible and demonstrate how the addition of ATP funds will help grow new opportunities for wheat farmers and differential service for overseas customers. These include on-going efforts to develop emerging wheat export markets in Myanmar, Malaysia, Vietnam and Indonesia as well as niche soft wheat markets in the Middle East and North Africa.

USW is already putting these ATP funds to work. In June, USW held a very successful conference for Mexican wheat buyers that brought together wheat farmers, the grain trade and flour millers who represent more than 80% of Mexico’s total wheat import volume. USW sees growth potential in Chile and with ATP funding sponsored a representative of a large Chilean buyers’ group to participate in the recent Wheat Quality Council’s annual hard red spring (HRS) wheat tour in North Dakota. ATP funding is now helping build increased awareness of U.S. wheat’s superior baking quality in flour blends in the large regional market around Bogotá, Colombia.

These ATP funds come at a critical juncture for the U.S. wheat industry, said USW President Vince Peterson.

Participants take measurements to estimate yield at the recent 2019 Spring Wheat Quality Tour in North Dakota.

“We appreciated the support for the traditional Market Access Program and Foreign Market Development program in the most recent Farm Bill,” he said. “However, those program apportionments have remained essentially unchanged for 17 years with FMD and 13 years with MAP and the ravages of time and inflation have eaten away at their effective bottom lines. This renewed financial capability is an important response that will help USW adequately address both today’s trade challenges and tomorrow’s new market opportunities.”

Peterson cited several trade challenges. Mexico for example is a leading buyer of U.S. wheat, but almost everything about that relationship depends now on the passage of the pending U.S.-Mexico-Canada Agreement on Trade. In Japan, a strong preference for several U.S. wheat classes there is threatened by the growing tariff advantage for Canadian and Australian wheat supplies under the new Trans-Pacific Partnership agreement. Since March 2018, China has turned to Canada to supply what had been U.S. wheat before tariffs were implemented and just this week its government announced changes that will make it possible to import Russian grain supplies. USW is encouraged by apparent progress in those negotiations reported on July 31.

The Trump Administration’s support through the ATP program, combined with the Market Facilitation Program (MFP), is welcomed by wheat farmers affected by low prices and other risks related to on-going trade challenges. It is no exaggeration to say that the long-term health of an industry that contributes about $6 billion per year to wheat farm families and U.S. wheat supply businesses hinges on a swift and favorable end to the on-going trade disputes.

*Header Photo Caption: Panel on “Optimizing Rail Operations of U.S. Wheat Shipments and Minimizing Additional Expenses for Mexican Importers.” at the USW Mexico Wheat Trade Conference, June 2 to 4, 2019.

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By Casey Chumrau, USW Marketing Manager, Santiago Office

The Federal Grain Inspection Service (FGIS) may be somewhat unfamiliar to most farmers but serves as a major competitive advantage for U.S. grains on the international market. Based on two congressional acts establishing a standardized inspection process, all wheat exported from the United States is inspected and given a grade as it is loaded onto the export vessel, whether it be a train or ship. This independent process sets the United States apart by providing a form of certainty and protection for buyers.

An official FGIS grade certificate is sent to buyers before the vessel arrives, allowing them to make important production decisions in advance based on the characteristics of the wheat before it arrives. In addition, the buyer knows that an independent agency will certify that every shipment meets the grade requirements specified in their contract, avoiding costly conflicts between the buyer and seller. The U.S. farmer works hard to produce a high-quality crop demanded by the market, and the FGIS inspection process helps maintain that quality all the way to the end user. This is a significant differential advantage of purchasing U.S. wheat versus other origins.

FGIS has an international affairs office that provides educational training programs explaining the roll and procedures of the agency. U.S. Wheat Associates (USW) has used this service many times over the years, most recently July 15 to 19, 2019, in Peru, an import market of about 2.0 million metric tons (73.5 million bushels). FGIS agent Jose Robinson traveled to Peru to conduct half-day seminars in the five largest wheat importing companies in the country. Robinson gave presentations and demonstrated parts of the inspection process to 53 participants from the quality control departments of the five mills. The participants shared their processes with Robinson, showed examples of the wheat they inspected in plant and were able to test their abilities to conduct similar inspections while receiving guidance from an expert.

The participants gained a deeper understanding of the FGIS inspection protocol and testing methods and left with increased trust and confidence in the FGIS certification process. The changes implemented in the mills following the training sessions will result in fewer discrepancies between the FGIS grade and the results of local, in-plant inspections, leading to increased satisfaction with U.S. wheat.

The ability to send an FGIS agent overseas allows USW to train a large number of participants at a fraction of the cost it would require to train even a few customers in the United States.

The USW Santiago Office plans to repeat this training activity in four other South American countries over the next two years. Learn more about how USW works with buyers here.

 

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By Claire Hutchins, USW Market Analyst

This week, my colleague, Michael Anderson, and I joined four U.S. wheat customers from Mexico and Chile for the annual Wheat Quality Council (WQC) Spring Wheat Tour, an early survey of the 2019/20 hard red spring (HRS) crop in North Dakota and surrounding states. Today the tour estimated a final average yield potential of 43.1 bushels per acre (bu/ac) or about 1.17 metric tons (MT) per hectare for the 2019/20 North Dakota HRS crop. That is 5% higher than last year’s average of 41.1 bu/ac (1.12 MT/hectare). This year, tour participants made 371 stops to scout fields compared to 325 in 2018.

Each year, industry participants from across the United States and several countries gather in Fargo, N.D., and spend two and a half days in small scout teams, randomly stopping at several fields in a full day. Teams follow individual routes established many years ago by WQC to ensure most of North Dakota and parts of northern South Dakota and western Minnesota are scouted by tour participants. Teams measure yield potential, determine an average for the route and estimate a cumulative, daily tour average when all scouts come together again in the evening.

Twitter Post: Day 2 on #wheattour19. Yellow route, Car #3. Near Hensler, ND. 35 estimated bu/acre. Healthy looking wheat in the soft to hard dough stage.

Dusty boots. Another purpose of the tour is to help educate a broad range of stakeholders about wheat production challenges. Scouts are asked to look for disease, weed and insect pressure, as well as soil conditions. This year, scouts enjoyed warm, dry tour conditions, a big change compared to a very wet period from August 2018 well into this year. Soil moisture is still adequate in some parts of the region, but the July 16 U.S. Drought Monitor shows abnormally to severely dry conditions in north central North Dakota.

On the first day, the tour traveled from Fargo along routes covering most southern North Dakota counties. The cumulative first day average HRS yield potential was 45.6 bu/ac (3.07 MT/hectare), compared to 38.9 bu/ac (2.61 MT/hectare) in 2018, on adequate soil moisture conditions, warm weather and minimal disease or insect pressure. Participants surveyed 153 fields recording a range from 13.5 bu/ac to 96.2 bu/ac. We saw strong stands of healthy wheat that were three to four weeks from harvest, depending on weather. Fields were mostly dry but standing water could be seen alongside roads and fields. Temperatures were in the mid- to high-70s Fahrenheit (24 to 26 degrees Celsius) and moderate Fusarium Head Blight (also known as “scab”) development was seen along several routes.

Twitter Post: “Yellow route, east of Mapes, ND. Jack Detiveaux with @AmericanBakers is riding along with USW’s Claire Hutchins today. Estimated yield 48 bu/acre on 7″ rows.”

On the second day, teams traveled north and east through north central North Dakota where wheat does not compete as much with corn or soybeans for acreage as it does in the southeastern region of the state. Participants noted significantly larger fields, more mature wheat and less head scab pressure. The cumulative Day 2 average HRS yield potential was 40.6 bu/ac (2.74 MT/hectare), compared to 41.3 bu/ac (2.78 MT/hectare) in 2018. Participants surveyed 139 fields recording a range from as low as 14.2 bu/ac to a high of 74.7 bu/ac.

On the third day, participants traveled south and east back to Fargo for the final scout meeting hosted by the Northern Crops Institute (NCI). Teams noticed wetter field conditions, slight lodging, light scab pressure and more delayed overall crop development. The cumulative average HRS yield potential for the day was 48.6 bu/ac (1.32 MT/hectare), compared to 46.3 bu/ac (1.26 MT/hectare) in 2018.

Soil moisture impact. During the tour teams met many farmers in their fields. North Dakota farmers commented that beneficial rainfall throughout the spring and summer gave the 2019 HRS crop a boost over last year. Nearly every route averaged higher estimated yields on this wheat tour than the same routes in 2018, supporting farmer claims that 2019 could surpass 2018 harvest levels. One farmer near Wishek, N.D., expects 60 bu/ac on his farm due to cool temperatures earlier this spring and adequate soil moisture levels, which minimizes disease pressure and helps wheat yield potential. If realized, his farm would yield 39% higher than the tour’s total estimated average of 43.1 bu/acre (1.17 MT/hectare).

Days to harvest. Scouts on the tour identified most fields in the soft to hard dough stages, indicating harvest is two to five weeks away depending on weather. If warm, breezy conditions persist, some North Dakota farmers could begin the HRS harvest in as few as 20 days.

For more information, visit the WQC website at https://wheatqualitycouncil.org. Highlights and photos from the tour are posted on Facebook and Twitter using #wheattour2019.

Twitter Post: Yellow route, car #3. Near Barlow, ND. Estimated yield 37.3 bu/acre. A few spots of Fusarium Head Slight, but otherwise a good looking field.

 

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Recent news and highlights from around the wheat industry.

Quote of the Week: ““We are concerned that Chinese customers are learning to make do without us. We are hoping that business will bounce back if we return to normal tariff treatment and can again go toe to toe with other imported origins.” – Jeff Coey, Regional Vice President, Hong Kong and China, U.S. Wheat Associates, from an article in Agri-Pulse about the on-going effects of the U.S.-China trade dispute.

Spring Wheat Buying. Reuters reported that Asian flour millers have been actively buying U.S. and Canadian spring wheat since last week as competitive prices drive demand for the grain used largely in making breads and pizza crusts. Millers from the region’s top importer Indonesia, and other countries such as Japan, the Philippines and Thailand, have signed contracts to import about 300,000 to 400,000 [metric tons] since last week, two Singapore-based trade sources said. Read more here.

A Complicated Web of Ideas. Conservationist in the Pacific Northwest have long advocated for opening federally owned dams on the Columbia and Snake Rivers to benefit salmon and other wildlife. Yet the lock and dam systems are essential for the highly efficient barge transportation system that benefits wheat farmers and their overseas customers. Boise (Idaho) Weekly examines this challenge in an article posted online here.

U.S. Grocery Shopping Trends. Farmers and overseas food processors may be interested in Food Marketing Institute’s (FMI) 45th edition of U.S. Grocery Shopper Trends, an annual look at grocery shopper attitudes and behavior. The 2019 report, prepared by The Hartman Group, Inc., studies what consumers want from their retailers when personalizing their grocery shopping. “One third of households have at least one family member following a non-medically prescribed diet, and this rate is higher for younger generations,” said the CEO of FMI. “In an effort to meet their idea of eating well, households are eating in increasingly personalized ways, challenging the food shopping experience.”

IAOM-KSU Flour and Dough Analysis. The IAOM-KSU Flour and Dough Analysis short course will be held at the IGP Institute in Manhattan, Kan., Sept. 10 to 12, 2019. The course will focus on flour and dough analysis practices and methods and correct interpretation and understanding of the results. Click here to learn more and register.

IAOM-KSU Basic and Advanced Milling Principles. Through hands-on training in the Kansas State University milling facilities and classroom discussions at the IGP Institute, these two courses will further develop participants basic and advanced milling skills and understanding of the milling process. The IAOM-KSU Basic Milling Course will be held Oct. 7 to 11, 2019. Click here to learn more about this course and register. The IAOM-KSU Advanced Milling Course will be held Oct. 14 to 18, 2019. Click here to learn more about this course and register.

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 page at https://www.facebook.com/uswheat for the latest updates, photos and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter at www.twitter.com/uswheatassoc and video stories at https://www.youtube.com/uswheatassociates.

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Many years of work conducting trade service and technical support in South Asian countries like Myanmar (Burma) showed U.S. Wheat Associates (USW) there was a growing opportunity to compete with nearby Australian wheat supplies. Knowing two deep-water ports were opening in Myanmar in 2019, USW intensified its activities. In mid-May 2019, USDA Foreign Agricultural Service representatives were on hand to welcome the first bulk grain vessel to dock at one of the ports loaded with 22,000 metric tons (MT) of high-quality U.S. hard red spring (HRS) wheat purchased by a local flour mill.

With funding from the Market Access Program (MAP) and Foreign Market Development (FMD) program, USW has provided technical and trade servicing to mills and bakeries in Myanmar for more than 20 years.  With the ability only to take container loads, U.S. wheat had to compete with less expensive supplies shipped mainly from nearly Australia. Still, its political situation was changing and consumer purchasing power was growing.

To lay the groundwork for U.S. wheat bulk shipments to customers in Myanmar, USW hosted a workshop on FGIS inspection and certification in marketing year 2017/18 for three milling companies and government officials. USW separately brought in a private trading company and the FAS staff in Yangon to brief the Myanmar Plant Protection Department about the bulk U.S. wheat export supply system. The briefing provided information that helped increase the confidence in purchasing and handling U.S. bulk wheat shipments.

The vessel New Journey carrying 22,000 metric tons of U.S. HRS at berth in Thilawa port at Yangon, Myanmar, May 2019.

Technical training continued with seven individuals from Myanmar baking companies who participated at their companies’ expense in three USW-sponsored baking courses at the UFM Baking School in Bangkok, Thailand, between May and July 2018. In a survey about their participation, these customers said they planned to demand flour produced from U.S. HRS wheat in their processing plants. And in December 2018, USW Bakery Consultant Roy Chung made a technical service call on a milling and wheat food processor in Myanmar to provide additional information on the potential value in milling U.S. HRS for bread flour and blending for other products.

In 2019/20, USW will apply funding from the FMD program to bring purchasing managers from selected Myanmar flour mills to the United States for a course called “Contracting for Value.” Participation will help the milling executives quantify the economic value of U.S. wheat classes and will help them understand possible adjustments in contract specifications to enhance that value.

Myanmar-based customers are embracing the benefits of working with imported U.S. wheat. Exports of HRS and soft white (SW) wheat to Myanmar grew from 26,300 MT in 2017/18 to about 65,000 MT in 2018/19. USW will continue to provide valuable trade and technical support there and throughout the growing wheat markets in South Asia.

*Header Photo Caption: Myanmar International Terminal Thilawa (MITT)