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U.S. Wheat Farmers Have Not Abandoned Customer Service in China

It is certainly true that the trade relations between the United States and China are in a difficult place. With the latest round of tariff increases announced and imposed, it is certainly possible to imagine that this conflict will not end soon. But we must all remember that negotiations are happening, and reworking the trading relationship between the two largest economies in history was never going to be easy.

In the meantime, U.S. Wheat Associates (USW) stands firmly by the following article by USW President Vince Peterson, “In Spite of Trade Conflicts, U.S. Wheat Farmers Will Not Abandon Customers in China,” published in “Wheat Letter” nine months ago.

USW remains engaged in keeping our once and future customers in China informed about the quality, variety and value of U.S. wheat in anticipation of future opportunities. Upcoming work includes a short course on contracting for wheat value, baking demonstrations in cooperation with the USDA’s Foreign Agricultural Service trade office in Beijing, and additional technical milling support activities in China. The commitment to service there will continue long after this trade conflict has ended. 

In Spite of Trade Conflicts, U.S. Wheat Farmers Will Not Abandon Customers in China

By Vince Peterson, USW President. Originally published August 21, 2018.

Chinese Vice Minister of Agriculture Han Jun recently acknowledged the decades of work that U.S. farmers have put into growing the Chinese market for U.S agriculture. He then warned that this market may never come back to where it was if the trade dispute with the United States continues much longer.

We can guarantee the Vice Minister, and the wheat food industry in China, that U.S. Wheat Associates (USW) and the farmers we represent will not turn our backs on our outstanding customers in China. We remain dedicated to our core mission in China, as we are everywhere in the world, to bring profitability and value to our customers even if that is temporarily more difficult today.

Presumably, Chinese leaders believe that U.S. farmers can persuade the Trump Administration to end this trade war with China. However, U.S. farmers have been clear with their own government that China’s predictable response to the conflict has harmed them and we have supported negotiations to resolve this conflict. While we agree that escalating rounds of tariffs are a bad idea, we also believe that many of the U.S. government complaints about China’s policies are valid.

In our experience, state disruption of the wheat trade has been an enormous problem, severely limiting opportunities and profitability for both U.S. farmers and our wheat food industry customers in China. Through opaque administration of its wheat tariff rate quota (TRQ), China has deprived its flour mills of an average of 6.5 MMT of imported wheat annually over the past decade. In fact, recent import volumes are still well below what China imported in the 1980s and early 1990s; that is, before it joined the World Trade Organization (WTO). One could be forgiven for thinking China was a more promising market before joining the WTO than after; almost entirely because of excessive subsidies to the domestic wheat crop in recent years, as well as tight limits on TRQ access. This is why the U.S. government, under the Obama Administration, initiated two WTO cases on these issues in the fall of 2016. The prosecution of those cases has been continued and pressed forward by the Trump Administration. We are highly supportive of this action.

The Chinese government should recognize that its many years of flouting international commitments and highly interventionist “state capitalism” have led directly to the present conflict. If China had lived up to the commitments made when it joined the WTO, it is highly doubtful that we would still find ourselves in this situation. If Chinese leaders want to avoid further conflict and bolster the international trading system that they claim to defend, China can first start behaving like a responsible economy and adhere to its trade commitments in both letter and spirit. Of course, we are urging the same from the United States, which must also approach China with clear demands and a path towards achieving them.

Nevertheless, we are confident that this trade confrontation will one day be resolved. In the meantime, we will continue to reach out to our customers and friends in China, to reassure them of our unfailing dedication to our work with them. Further, we will make the guarantee that, once this trade dispute is resolved and behind us, we will work harder than ever to continue earning their business as we chart a path, together, to build the commercial channels that hold so much promise for Chinese and American industries and people.

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First Look at 2019/20 by USDA Sees Another Record World Wheat Crop

By Claire Hutchins, USW Market Analyst

On May 10, USDA issued its first set of forecasts for 2019/20 in its World Agricultural Supply and Demand Estimates report. USDA expects global wheat production at a new record of 777 million metric tons (MMT) and exceeding expected use again as major global suppliers rebound from last year’s unfavorable growing conditions.

Droughts in the European Union (EU) and Australia last year cut production in both regions to 5-year and 10-year lows, respectively. Growing conditions in both regions are more favorable now and USDA expects total EU wheat production to rebound 12% from last year to 154 MMT.

Australian wheat production is expected to reach 22.5 MMT, up 23% year-over-year but still 3% below the 5-year average of 23.3 MMT.

USDA’s initial forecast for Russian production shows a 6% increase over last year’s 72.0 MMT to 77.0 MMT in 2019/20 and a small decline in export volume. Notably, SovEcon, a Russian consultancy pegs 2019/20 Russian wheat production closer to 83.0 MMT, 7% higher than USDA’s official estimate and 15% higher than last year’s total production, if realized.

World beginning stocks of 275 MMT paired with the forecast for increased production bring total supply in the new marketing year to a record 1,052 MMT. USDA says large supplies in 2019/20 will be met by increased global demand for feed wheat and food consumption. USDA forecasts total global domestic consumption will reach a record 759 MMT in 2019/20, compared to 738 MMT the year prior. Global trade, at 285 MMT, is 4% higher than last year and 5% higher than the 5-year average of 176 MMT.

USDA predicts U.S. wheat production in 2019/20 will total 51.6 MMT. Though down somewhat from last year, that volume and increased beginning stocks push U.S. exportable supplies up to 52.0 MMT, the largest in the world. As global trade and consumption continue to rise, the abundance and end-use versatility of U.S. wheat classes reaffirm the United States remains the world’s most reliable supplier of wheat.

Each month, U.S. Wheat Associates (USW) updates a graphic summary of USDA’s WASDE (World Agricultural Supply and Demand Estimates) report. View the May summary here.

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K-State Researchers Find New Clues for Improving Wheat

Originally published by K-State Research and Extension;

Reprinted with permission from the Kansas Wheat Commission

A team of Kansas State University wheat scientists are tapping into 10,000 years of evolution in the plant’s genetic code as part of their continued efforts to understand how historic processes that shaped modern wheat can help to improve the varieties grown by today’s farmers.

The exhaustive study, which is published in Nature Genetics, involved sequencing the genomes of nearly 1,000 wheat lines collected from different parts of the world with different environments. The work was led by researchers from K-State and Agriculture Victoria of Australia, in collaboration with the University of Saskatchewan (Canada) and the University of Minnesota.

“We compared the genomes (in the 1,000 wheat lines) against each other, and looked for nucleotide base changes, or mutations, that distinguish one wheat accession from another,” said Eduard Akhunov, a K-State wheat geneticist.

He noted that the researchers found more than 7 million differences in the genetic code of the 1,000 lines.

“These differences can affect the function of genes that control various traits in wheat that helped it adapt to new growth conditions, such as withstanding drought and heat stresses; fighting off diseases; and yielding nutritious grain,” Akhunov said.

The changes that occurred in the genetic code can tell researchers a history of each wheat accession.

“When humans started spreading wheat from the site of its origin to other places, they brought it into contact with wild wheat, and wild ancestors accidentally began to inter-breed with bread wheat,” Akhunov said. “What happened then was that bread wheat  inherited the genetic diversity that was present in the wild emmer wheat.”

That process of one species sharing genes with another species is called gene flow, and it is key for explaining the genetic diversity of today’s wheat varieties, according to K-State wheat breeder Allan Fritz.

“Understanding gene flow between wild emmer and common wheat is more than just academically interesting,” Fritz said. “The importance of historical introgression suggests that a more strategic use of wild emmer should have value for future wheat improvement.”

Fritz noted that K-State scientists have been using wild emmer in developing germplasm for new wheat varieties in projects funded by the Kansas Wheat Commission and the university’s Wheat Genetics Resource Center.

The work by Akhunov and his research team allows breeders to “evaluate the diversity in wild emmer and be intentional and strategic” in how they employ desired traits in new wheat varieties, according to Fritz.

“As we move forward, we can apply what has been learned here to also focus future efforts on traits related to health and nutrition that wouldn’t have been direct targets of historical selection,” he said.

Akhunov adds: “For the first time, we have described how wild emmer’s genetic diversity contributed to the development of bread wheat. And what it’s done since humans domesticated wheat is it’s helped to develop a better crop.”

K-State’s study was funded by the Agriculture and Food Research Initiative’s competitive grants program, administered through the U.S. Department of Agriculture’s National Institute of Food and Agriculture and part of the International Wheat Yield Partnership, which Akhunov said aims at increasing the genetic yield potential of wheat using innovative approaches.

Akhunov also said that Corteva Agriscience and the agriculture division of Dow/DuPont provided financial support through its collaboration with Agriculture Victoria Service. Their support, he said, allowed the researchers access to needed technologies and to develop the set of data indicating the genetic differences in wheat varieties, also called an SNP dataset.

K-State received additional funding from the Kansas Wheat Commission and the Bill and Melinda Gates Foundation.

Header Photo Caption: Kansas State University wheat geneticist and pathologist Eduard Akhunov works in the university’s greenhouse. Photo Credit: K-State Research & Extension

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Keep Up with the Combines by Subscribing to USW Harvest Reports

As it did last year, a cool, wet spring has delayed the start of the 2019/20 U.S. winter wheat harvest. Progress may be slow, but the new crop harvest is coming. USDA’s National Agricultural Statistics Service reported on May 5 that wheat was maturing in South Texas while farmers in the state’s Coastal Bend area were waiting for drier conditions to start harvest.

You can monitor progress by subscribing now to the U.S. Wheat Associates (USW) Harvest Report, a key component of USW’s international technical and marketing programs. It is a resource that helps customers understand how the crop situation may affect basis values and export prices.

Harvest Report is published every Friday afternoon, Eastern Daylight Time, throughout the season with updates and comments on harvest progress, crop conditions and current crop quality for hard red winter (HRW), hard red spring (HRS), soft white (SW), durum and soft red winter (SRW) wheat classes.

USW also includes links in the email to additional wheat condition and grading information, including the U.S. Drought Monitor, USDA/NASS Crop Progress and National Wheat Statistics, the official FGIS wheat grade standards and USDA’s World Agricultural Supply and Demand Estimates report.

To subscribe to the Report as well as USW’s weekly (export) Price Reports and the “Wheat Letter” e-newsletter, click here, or visit the www.uswheat.org home page and click on the green “Subscribe” button near the top right of the page (see below).

USW also publishes the report in Spanish which is posted here at www.uswheat.org/es. Harvest Reports, Price Reports, Wheat Letter, Commercial Sales and World Wheat Supply & Demand Report are also all posted online at www.uswheat.org/market-and-crop-information/.

Follow along on social media with the hashtag #wheatharvest19.

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Decoded Durum Genome Opens Doors to Potential Improvements

In April, the results of a study by a consortium of researchers from seven countries was published in “Nature Genetics” describing the sequence of the entire genome of an Italian durum wheat variety called “Svevo.” Durum breeders suggest this is an important finding that will help speed development of new, improved varieties of the crop that provides semolina for high quality pasta products.

“We can now examine the genes, their order and structure to assemble a blueprint that provides an opportunity to understand how the genes work and communicate with one another,” said University of Saskatchewan wheat breeder Dr. Curtis Pozniak in a statement from the consortium. “With this blueprint, we can now work quickly to identify genes that are responsible for the traits we select for in our breeding programs such as yield, disease resistance, and nutritional properties.”

Calling the work ground-breaking, another spokesperson for the consortium said it “will lead to new standards for durum breeding … paving the way for production of durum wheat varieties better adapted to climate challenges, with higher yields, enhanced nutritional quality and improved sustainability.”

“This is good news for durum breeders,” said Dr. Elias Elias, Distinguished Professor, J. F. Carter Durum Wheat Breeding/Genetics, with the Plant Sciences department of North Dakota State University (NDSU). “We do know much about the positive traits we want to express. Now, with the complete genome map, we will be able to identify the specific gene or markers for the genes responsible for the traits in a much more precise way.”

For example, the team that decoded the genome said they had discovered the gene that causes the durum plant to take up cadmium, an undesirable trait. Dr. Elias said NDSU has already introduced durum varieties with low cadmium uptake. With the specific gene identified, breeders can more quickly select for varieties without the undesirable trait for conventional breeding methods or, perhaps in the future, precisely alter an undesirable function through gene editing to bring improved varieties to farmers more quickly.

USDA, which also administers export market development programs through its Foreign Agricultural Service, contributed some funding for the genome study. More information is available online at https://bit.ly/2LqBCsk.

Scientists have recently mapped the complex, polyploid genome of hard amber durum, grown in the northern U.S. Plains and Desert Durum® grown in the desert Southwest, produces semolina for premium pasta products, couscous and semolina bread. This class evolved from wild emmer wheat and was established as a prominent crop up to 2,000 years ago.

 

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Wet, Cold HRW Wheat Tour Predicts Good Yield Potential

By Claire Hutchins, USW Market Analyst

This week, two U.S. Wheat Associates (USW) colleagues and I joined the Wheat Quality Council (WQC) on its 62nd annual “Hard Winter Wheat” Tour for an early survey of the 2019/20 hard red winter (HRW) crop in Kansas and parts of surrounding states. Just a few hours before USW published this issue of “Wheat Letter,” the tour estimated a final average yield potential of 47.2 bushels per acre (bu/ac) or about 3.18 metric tons (MT) per hectare for the 2019/20 Kansas HRW crop. This year, tour participants made 469 stops to scout fields. Combining seeded area with per-acre yield potential, the total production potential estimate for Kansas was 307 million bushels or about 8.36 million metric tons (MMT). Last year’s total production estimate was 243 million bushels (6.61 MMT).

USW Market Analyst Claire Hutchins on her first Wheat Quality Council Hard Winter Wheat Tour.

Each year, industry participants from across the United States and several countries gather in Manhattan, Kan., and spend the next two and a half days in small scout teams, randomly stopping at 9 to 17 fields in a full day. Each team follows a colored route established decades ago by WQC to ensure most of Kansas and parts of southern Nebraska and Northern Oklahoma 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.

Muddy 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, week and insect pressure, as well as soil conditions. Last year, tour participants enjoyed dryer, warmer weather. This year, rain and colder temperatures gave first-time scouts, like me, a true look at variable spring weather in Kansas. Our muddy boots proved that last year’s severe drought, which covered most of the state as of late April, is a distant memory. The April 23, 2019, Drought Monitor shows zero drought or abnormal dryness across the state of Kansas.

Muddy boots were common on the wet 2019 tour.

On the first day, the tour traveled from Manhattan along several routes covering most northern Kansas counties. The cumulative Day 1 average yield potential was 46.9 bu/ac, the equivalent of 3.15 MT per hectare, compared to 38.2 bu/ac (2.57 MT/hectare) in 2018. To reach that average, participants surveyed 240 fields recording a range from a low of 16 bu/ ac to a high of 96 bu/ac. We saw very short and sparse wheat that was two to four weeks behind developmentally. Fields were adequately moist to slightly dry with no standing water. Temperatures were in the mid-40s Fahrenheit (a little more than 4 degrees Celsius) which prevents disease establishment and helps yield potential. Below-average temperatures in the next few weeks could help yield potential for winter wheat, a cool-season grass.

Participants also received a report on the Nebraska and Colorado wheat crops. Nebraska estimated an average 44.0 bu/ac (2.95MT/hectare), up slightly from last year’s tour estimate. Nebraska’s 2019 production forecast is currently 47.4 million bushels (1.29 MMT), up 8% from the 2018 estimate. Colorado predicted an average of 46.5 bu/ac (3.12 MT/hectare) with total production predicted to reach 97.2 million bushels (2.64 MMT), up 39% year-over-year, if realized.

Late Planting Impact. On the second day, the tour scouts traveled on routes from Colby in northwest Kansas to south-central Wichita, making 200 stops. The number of observations was down significantly from last year due to cold, rainy weather. Scouts reported most wheat was two to four weeks behind normal development due to late planting in the fall but continued to see nearly no disease pressure due to April and early May’s cooler than average temperatures. That could push the region’s peak harvest well into June, especially if the cool temperatures persist. This year, the tour estimated Day 2 average yield at 47.6 bu/ac (3.20 MT/hectare), for a combined two-day average yield of 47.2 bu/ac (3.17 MT/hectare) across 440 stops. Last year, the combined two-day average was 36.8 bu/ac (2.47 MT/hectare) on 601 stops.

Each scout calculates their observed yield potential, then the scout car’s average is determined.

Participants also received a crop report from Oklahoma, where adequate rainfall through the growing season helped increase the 2019 average yield projection compared projections in last year’s drought. The estimated average yield in Oklahoma is 37.4 bu/ac (2.51 MT/hectare), for a total production estimate of 119 million bushels (3.24 MMT). If realized, this would be up 50% over last year’s estimate on cool, moist weather and minimal disease pressure. However, marketing conditions are difficult for farmers. Low cash prices for winter wheat are causing many Oklahoma farmers to turn their fields to pasture or replace acres planted to HRW with cotton. Abandoned HRW acres are expected to reach 8% to 10% in 2019.

USW Director of Programs Erica Oakley was among nearly 100 scouts on the 2019 tour.

The final day of the tour was shorter, with each car making 3 to 4 field stops from Wichita to Manhattan where all the data were compiled in the final report. The Day 3 estimated average yield was 46.2 bu/ac (3.11 MT/ hectare), across 29 stops.

USW Director of Programs Erica Oakley and Assistant Director of Policy Elizabeth Westendorf and I will use what we learned on the tour to help educate overseas customers about the new crop and how development delays may affect their purchase decisions. I was raised on an irrigated farm in western Colorado, so this experience helps me understand the volatility of growing conditions with dryland wheat. I want to learn more to work with traders, and I look forward to participating in WQC’s Spring Wheat Tour in July. For more information, visit the Council’s website at https://www.wheatqualitycouncil.org.

Highlights and photos from the tour are posted on Facebook and Twitter using #wheattour19.

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Wheat Industry News

Recent news and highlights from around the wheat industry.

Quote of the Week: “I am convinced that the majority of American people do understand that we have a moral responsibility to foster the concepts of opportunity, free enterprise, the rule of law, and democracy. They understand that these values are the hope of the world.” – The late U.S. Sen. Richard Lugar who, with former Senate Finance Committee Chairman and Ambassador to China Max Baucus, founded “Farmers for Free Trade” in 2017. Sen. Lugar passed away April 28.

USDA Moves to New Notifications Platform. As of May 1, 2019, USDA moved its email subscription service to a different platform. To continue receiving notifications such as press releases, blogs and trade announcements you must re-enroll on their new site here.

2017 Census of Agriculture: Highlights for Wheat. The USDA National Agricultural Statistics Service (NASS) released its 2017 Census of Agriculture statistics on April 11. The Census, released every 5 years, includes data on farm demographics, land area, production and production value and more at the national, state, and county levels. The National Association of Wheat Growers (NAWG) posted a blog highlighting wheat-specific data from the 2017 Census that shows a reduction in total U.S. farms producing wheat, production and planted area; spring and durum planted area increased. Read it here.

Earth Day. Monday, April 22, 2019 was the 49th Earth Day! In its recent blog, NAWG highlights how wheat growers incorporate conversation and sustainability practices into their operations. Read the blog here.

Minnesota Wheat Hires New Executive Director. The Minnesota Wheat Research & Promotion Council (MWRPC) and the Minnesota Association of Wheat Growers (MAWG) recently hired Charlie Vogel to serve as the Executive Director for both organizations. Vogel will start his duties on June 1, 2019. Read the full announcement here.

U.S. EPA: Glyphosate Not A Carcinogen. From a press release: “The U.S. Environmental Protection Agency (EPA) is taking an important step in the agency’s review of glyphosate. As part of this action, EPA continues to find that there are no risks to public health when glyphosate is used in accordance with its current label and that glyphosate is not a carcinogen. The agency’s scientific findings on human health risk are consistent with the conclusions of science reviews by many other countries and other federal agencies. While the agency did not identify public health risks in the 2017 human health risk assessment, the 2017 ecological assessment did identify ecological risks. To address these risks, EPA is proposing management measures to help farmers target pesticide sprays on the intended pest, protect pollinators, and reduce the problem of weeds becoming resistant to glyphosate.” Click here to read more.

Baking with Whole Wheat and Whole Grains Course. The Northern Crops Institute is hosting a course focused on the utilization of whole wheat flour made from hard red spring (HRS) wheat and how to incorporate other whole grain ingredients into wheat-based products. The July 30 to Aug. 2, 2019 course will be at its facilities in Fargo, N.D. Click here to learn more and register by Monday, July 8.

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.

Buhler-KSU Executive Milling Short Courses. IGP Institute offers this executive milling course several times in 2019 at its campus in Manhattan, Kan. The course, focused on the underlying principles of the milling process and operational management, will be offered in English May 20 to 24, 2019, and Nov. 4 to 8, 2019, as well as in Spanish Aug. 26 to 30, 2019. Click here to register to these courses.

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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Promoting Wheat Around the World

As U.S. Wheat Associates (USW) President Vince Peterson often says, at any given hour of the day there is someone, somewhere, talking about the quality, reliability and value of U.S. wheat. Wheat Letter wants to share some of the ways USW was working the past few months to promote all six classes of U.S. wheat in an ever more complex world wheat market.

Brazil. During President Bolsonaro’s meeting with President Trump in March, the Brazilian president announced the implementation of the tariff rate quota (TRQ) that would allow 750,000 MT of non-Mercosur wheat into Brazil tariff free, something USW has pushed for years to be implemented. Soon after the announcement, USW offered support to Brazilian buyers and any purchasing information they may need to consider U.S. now and in the future. When realized, this change will give U.S. wheat farmers the chance to compete fairly for a sizable part of Brazil’s import needs every year.

The Philippines. With funding provided by the Washington Grain Commission, USW organized a team of research and development managers from the Philippine milling industry to take part in an End Products Collaborative in March at the Wheat Marketing Center in Portland, Ore. Recent expansion in the ASEAN milling industry has increased competition and created a need for millers to differentiate their flour products. This activity helps identify the best U.S. wheat options available.

Members of the Philippine Milling Industry participate in an End Products Collaborative at the Wheat Marketing Center.

During the End Products Collaborative the participants visited with the Wheat Marketing Center Board of Directors.

Malaysia. In March, USW South Asia Regional Vice President Matt Weimar conducted two days of trade servicing for a mill in Malaysia, which also has operations in Vietnam and Indonesia. In the past two years, this mill has doubled imports of U.S. wheat to Malaysia alone. Weimar gave a seminar on the World and U.S. Supply and Demand as of March 2019 and shared the value of utilizing additional information resources from USW and USDA.

South Korea. USW Baking Consultant Roy Chung and Food and Bakery Technologist Shin Hak (David) Oh visited Seoul in March to conduct a pre-mix seminar and workshop to demonstrate the versatility of U.S. wheat in a wide range of end products. Workshop participants enhanced their understanding of ingredient functionality and chemical leavening systems while experimenting with new product formulations in pre-mixes.

Participants of the Pre-Mix Seminar with the instructors in black: (L) USW Food and Bakery Technologist Shin Hak (David) Oh; (R) USW Baking Consultant Roy Chung.

Taiwan. In April, USW Regional Technical Director Peter Lloyd spoke at a milling seminar attended by members of the Taiwan Millers Association and faculty members of the China Grain Products Research & Development Institute (CGPRDI). Lloyd’s program focused on hard and soft wheat milling, solvent retention capacity (SRC) and SDS testing methods and their application in the mill, and profitability in the milling industry.

Milling Seminar Participants at the China Grain Products Research & Development Institute (CGPRDI).

China. To meet industry demand for deeper knowledge of techniques in frozen dough production, USW is collaborating with the Sino-American Baking school (SABS), Lesaffre Yeast and Square Technology Group Co., Ltd., to hold three sessions of frozen dough technology courses this year for millers and bakers. During the first session in March, USW Technical Specialist Ting Liu and Asian Products/Nutrition Technologist Shu-ying Yang spoke on the importance of choosing the correct flour for frozen dough by showing how freezing affects gluten functionality.

Panama. USW sponsored a wheat buyer from Panama to attend the IGP Institute Grain Purchasing Short Course in April. The course focused on contract specifications, financing grain imports, grain grading, ocean transportation, discussions of the cash and futures markets and included a visit to an export facility in Portland, Ore.

Spain, Portugal and Morocco. In March, a USW Board Team including farmers from Montana, Nebraska and Wyoming traveled to Spain, Portugal and Morocco to visit customers, millers, government officials and more to listen and learn more about those markets and how they utilize U.S. wheat. Read more about those visits here.

Visiting IFIM and touring the training mill, where the USW Board Team saw equipment sponsored by U.S. Wheat Associates. (L to R): Al Klempel (Montana), Kent Lorens (Nebraska) and Casey Madsen (Wyoming).

Morocco and Tunisia. In April, USW hosted a delegation from Morocco and Tunisia focused on grain storage and management that was part of the USDA Cochran Fellowship Program traveling to Kansas and Texas. This program provides short-term training opportunities to agricultural professionals from middle-income countries, emerging markets, and emerging democracies. Read more about this delegation here.

The Cochran Fellowship Program delegation from Morocco and Tunisia stopped by the Kansas Wheat Innovation Center where they toured its greenhouse and research facilities. The team was escorted by USW Milling & Baking Technologist Tarik Gahi, pictured far right. (Photo Credit: Kansas Wheat)

Italy. USW Regional Marketing Director Rutger Koekoek recently visited Italy for several meetings with the grain trade, milling companies and a leading pasta processor to discuss the advantages of U.S. hard red spring (HRS) and durum crop quality and functional performance in products for the Italian market.

Wheat Research. USW recently worked with CGIAR to create a fact sheet and other support materials promoting the benefits of U.S. investment in global wheat research collaboration.

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The Long-Term Risks of “National Security” Tariffs Have Appeared

By Ben Conner, USW Vice President of Policy

In June 2017, U.S. Wheat Associates (USW) suggested that pursuing a strategy of import protection under the guise of national security would set a dangerous precedent. Then USW President Alan Tracy said “… if the United States undermines WTO national security exemptions, it would be handing a gift-wrapped roadmap of protectionism to food self-sufficiency advocates all over the world.”

The United States did impose these tariffs and threatens more. The risk of imitation by other countries is a long-term threat to U.S. agriculture, but most affected countries to date have responded by retaliating against U.S. agriculture exports, rather than imitating the U.S. policy. In addition, these countries have brought several cases against the United States at the World Trade Organization (WTO). The United States claims these tariffs are allowed under the WTO’s national security exception, which is self-determined. Other countries claim such measures are allowed only if they fit under one of the criteria established in the WTO rules.

The WTO earlier this month gave a preview of how it might rule on the cases against the United States with its panel decision in a case that Ukraine brought against Russia. The report was adopted last week by the WTO Dispute Settlement Body (DSB). Ukraine argued that Russia’s restrictions on its transshipment rights violated WTO rules, which would be clearly true in normal circumstances. Russia claimed these restrictions were imposed for national security reasons due to the armed conflict with Ukraine. Russia further argued that the panel had no jurisdiction, because Russia had invoked the WTO’s GATT Article XXI, the rule that allows exceptions to normal WTO rules for national security reasons. Russia argued that determining national security is up to each country and therefore not subject to the panel judgment. The United States made the same argument in a third-party brief.

Russia won the case, because armed conflict is a valid national security issue, but lost the argument that the panel had no jurisdiction. At the risk of oversimplifying, the panel found that if the national security rule was meant to be self-judging, the authors of the agreement would not have included specific criteria. It quoted a U.S. delegate who said in 1947 that they supported the specific criteria due to the recognition “that there was a great danger of having too wide an exception…because that would permit anything under the sun.”

Permitting tariffs on “anything under the sun” could lead to devastating consequences for the competitive U.S. agriculture sector as more protectionist nations around the world follow the U.S. example. However, the United States, consistent with the position it has taken to date in this case, opposed this decision and claimed there should be no parameters on any trade restriction if the country imposing the restriction cites the national security exception.

USW takes no position on the respective arguments in the case but remains extremely concerned with the indiscriminate use of 232 tariffs that will likely put this question in front of the WTO DSB soon. This is a major challenge facing the WTO that did not need to happen and threatens to undermine the global trade rules that are so important to U.S. agriculture and its overseas customers.

The Trump Administration’s trade agenda includes fixing an extensive list of long-standing concerns with how some of our trading partners and international institutions have applied trade rules. USW shares many of these concerns. Unfortunately, we believe that the use of Section 232 undermines the long-term interests of the U.S. economy and U.S. agriculture in particular; and any gains made because of these tariffs are likely to be short term while the damage to the rules-based trading system could be permanent.

For additional information, visit https://bit.ly/2EA9HOn and https://bit.ly/2KmTSRx online.

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USDA Confirms Delay in Spring Wheat Planting and Good Potential for Winter Wheat

This week, the USDA’s National Agricultural Statistics Service (NASS) reported that as of April 28, U.S. spring wheat planting progress is significantly behind average as farmers wait for their fields to dry out.  Over the past 5 years, an average of 33% of spring wheat was in the ground by now but this year only 13% has been seeded.

What effect will that have on the 2019/20 U.S. hard red spring (HRS) crop? Experts say late planting typically hurts yield potential. Jonathan Kleinjan, an Extension agronomist with South Dakota State University, recently explained that HRS should be planted as early as possible since cooler weather from emergence to the early reproductive stages generally benefits tiller formation and the development of larger heads. Increased growth during the early season typically results in higher yields.

He noted a study in North Dakota that showed spring wheat planted May 1 had 6 fewer days of growth from emergence to 6-leaf stage when compared to wheat planted on April 15. He said the number of days was further reduced to 11 when planting was delayed until May 15. Yield data related to this research, he said, suggests that wheat loses 1.5% of its yield potential every day after the optimum planting date. His conclusion: the extended weather forecast shows unfavorable planting conditions extending well into May, so farmers may switch from small grains to later-planted row crops such as soybeans.

Progress is less than 10% in the major production area of the Northern Plains. The Pacific Northwest is a bit farther along, although Idaho’s Nez Perce County Extension agent Doug Finkelnburg said that “we’re a little delayed with spring planting this season — sort of like last spring.” He said the last date farmers there can purchase spring wheat crop insurance is in mid-May and suggested that planted area will be reduced if they delay goes beyond that time.

NASS also reported that U.S. winter wheat heading progress at 19% is 10 points less than the 5-year average, but crop condition is improving. NASS estimated 64% of total winter wheat was in good-to-excellent condition as of April 28, up 2 percentage points from the previous week. We will learn more about conditions and yield potential of the hard red winter (HRW) crop in Kansas, southern Nebraska, eastern Colorado and northern Oklahoma this week from the Wheat Quality Council Hard Winter Wheat tour. U.S. Wheat Associates (USW) colleagues will join more than 70 other participants and will report during the tour on Twitter using #wheattour19.

* Photo Credit: Aaron Harries, Kansas Wheat V.P. of Research and Operations, on the 2019 Winter Wheat Quality Tour in Kansas

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