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Name: Carlos Marcelo Mitre Dieste

Title: Technical Specialist

Office: USW Mexican, Central American and Caribbean Regional Office, Mexico City

Providing Service to: Barbados, Belize, Costa Rica, Cuba, Dominican Republic, El Salvador, Guatemala, Guyana, Haiti, Honduras, Jamaica, Leeward-Windward Islands, Mexico, Nicaragua, Panama, Suriname, Trinidad-Tobago, Venezuela

Regional Profile: The combination of economic growth, consolidation, increasing urbanization, and a steadily growing population is a catalyst for rising wheat food product consumption in this region. For example, the evolution of franchising, fast foods, convenience stores, snack foods, dual-income households, and more demanding consumers has led to the establishment of new products, better quality, more uniform standards, and a larger overall market for bread but also for Asian-style noodles, cookies, crackers, and pasta. Given the quality and diversity of U.S. wheat supplies and the comparative geographic advantages, USW’s focus on increased technical service and assistance is paying dividends as the region’s demand for wheat continues to grow.


Growing up in Mexico City and Monterrey, Mexico, young Marcelo Mitre’s experiments in his family kitchen firmly established his interest in food and, eventually, a career in the science of food production.

“I have always loved to eat, and as a kid, I would try to make every recipe I saw in newspapers or on TV shows, and my Mom has many funny stories about my early attempts in the kitchen,” Marcelo said. “But eventually, I was making cakes at home and selling them at my high school.”

Although he wanted to continue exploring his interest, Marcelo did not initially see options to do professional studies in the food sector, so he enrolled as a Marketing major at Instituto Tecnológico y de Estudios Superiores de Monterrey (ITESM).

“Then, during a function at school near the end of my first semester, I bumped into this small program called ‘Food Industry Engineering,” he recalled. “When I looked at the academic curriculum, the laboratory courses looked very interesting, and I immediately switched my major.”

A Framework for a Career

Marcelo’s undergraduate experience framed his work today as a Technical Specialist with U.S. Wheat Associates (USW), serving flour milling and wheat food processing organizations in Mexico, Central America, Venezuela, and the Caribbean. Internships at a large brewing company, a meat packing plant, and a frozen food manufacturer gave him experience in different food industries. He also considers his ITESM Professor of Cereal Science, Dr. Sergio Serna-Saldivar, as his mentor.

“After graduating, I continued working at the frozen food products company in Mexico,” Marcelo said, “then Dr. Serna suggested I apply for a master’s program studying cereal science with Dr. Lloyd Rooney at Texas A&M University. My master’s thesis was Barley Tortillas and Barley Flours in Corn Tortillas. We chose the topic because tortillas are the staple food in Mexico, and I wanted to see if we could increase the health benefits and textural characteristics of tortillas.”

Technical Specialist Marcelo Mitre earned a master’s degree with a thesis on improving tortilla nutrition. He continues to promote flour tortilla nutrition and quality improvement using U.S. wheat.

Post-graduate experience in commercial food research and development and technical sales continued Marcelo’s path toward his responsibilities at USW. At Sage V foods in Texas, he developed rice products. At Illinois-based Continental Custom Ingredients, Inc., Marcelo represented the company’s stabilizers, emulsifiers, and ingredient systems with Latin American food customers. He eventually opened a laboratory in Mexico City for that company, later acquired by Tate and Lyle.

“I liked the combination of R&D and sales a lot,” Marcelo said. “I am a very hands-on person, and technical sales gave me the opportunity to interact with the clients and understand their needs. I also liked being in the laboratory using what I learned from the clients to help develop solutions for them.”

The Right Fit for USW

In 2009, Marcelo returned to the United States to work at a cooking fats and oils company in Miami, Fla. At the same time, USW Regional Vice President Mitch Skalicky was searching for the right individual who could serve in a wide-ranging technical position.

“All the candidates I had interviewed were either not qualified or did not fit the profile we needed,” Skalicky said. “I asked a contact at ITESM to let us know if they had a potential candidate. Not long after, Dr. Serna made the connection that brought Marcelo to USW. In Marcelo, we saw a highly intelligent person, having graduated from one of the top universities in Latin America, with a very strong background in engineering, technology, and food science.”

Several things about the job with USW attracted me,” Marcelo said. “It was a chance to continue doing hands-on work across the very active flour and wheat foods industry based in Mexico City but still traveling throughout the region and internationally. Mitch and others explained that this was a not-for-profit organization representing U.S. wheat farmers with a very low turnover of people. That told me this would be a nice work environment.”

Based on customer needs and the annual regional activities plan, Marcelo is responsible for activities that range from helping flour mills blend flour from different U.S. wheat classes to improve product quality and reduce costs, to conducting cookie and bread baking seminars for food processors, alone or with consultants, to pasta production courses across the region.

Baking instruction and quality evaluation with customers in Mexico, Central America, Venezuela, and the Caribbean is a crucial part of Mitre’s work.

“Marcelo represents the very positive and strategic support we get from U.S. Wheat Associates,” said an executive with a large flour milling company in Honduras. “We know we can count on him to guide us or give us suggestions on how to address a challenge, and we bring him to visit our clients to find ways to improve their processes or products.”

Another regional flour milling executive said Marcelo is a very important link to information about U.S. wheat quality and processing.

A baking company manager in Guatemala also testifies to Marcelo’s technical baking knowledge and how he applies it in workshops to demonstrate the benefits of U.S. wheat flour. The manager added: “I can attest that Marcelo is a responsible person who is committed to his work, is very organized, and has excellent people skills.”

A Balanced Approach

Marcelo said long-distance running, which was something he started in high school “to lose weight,” taught him to balance work, social life, sleep, and training for five marathon races, running four of them in less than three hours!

“There are no excuses if you fail to do one of the four,” he said, “because you will be the only one affected. You become very organized in your life because every minute counts in your schedule.”

“Marcelo has shown an exceptional work ethic combined with the ability to learn quickly, adapt to a diverse set of circumstances and respond in a very flexible way to any challenge,” Skalicky said. “He has the interpersonal skills to work with both management as well as production and quality control staff.”

“It is a pleasure to work with U.S. Wheat Associates, and for the U.S. farmers we represent,” Marcelo said. “The people in all our offices are very friendly, and you can contact anyone, anywhere, about any question, and they will share information without hesitation. Most important,” he added, “our work is focused on giving our customers freely, without obligation, the information and skills they need to improve their products and businesses. And we feel very good about being able to do that!”

Mitre’s work and enthusiasm takes him all over the region, working with various customers and groups.


By Steve Mercer, USW Vice President of Communications

Editor’s Note: This is the third in a series of posts profiling U.S. Wheat Associates (USW) technical experts in flour milling and wheat foods production. USW Vice President of Global Technical Services Mark Fowler says technical support to overseas customers is an essential part of export market development for U.S. wheat. “Technical support adds differential value to the reliable supply of U.S. wheat,” Fowler says. “Our customers must constantly improve their products in an increasingly competitive environment. We can help them compete by demonstrating the advantages of using the right U.S. wheat class or blend of classes to produce the wide variety of wheat-based foods the world’s consumers demand.”


Meet the other USW Technical Experts in this blog series:

 

Ting Liu – Opening Doors in a Naturally Winning Way
Shin Hak “David” Oh – Expertise Fermented in Korean Food Culture
Tarik Gahi – ‘For a Piece of Bread, Son’
Gerry Mendoza – Born to Teach and Share His Love for Baking
Peter Lloyd – International Man of Milling
Ivan Goh – An Energetic Individual Born to the Food Industry
 Adrian Redondo – Inspired to Help by Hard Work and a Hero
Andrés Saturno – A Family Legacy of Milling Innovation
Wei-lin Chou – Finding Harmony in the Wheat Industry

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Recent news and highlights from around the wheat industry.

Quote of the Week: “With these decisions, we call on the Chinese government to come into compliance with the rules it accepted when it joined the WTO. The world now sees that their policies stifle market-driven wheat trade, block export opportunities and force private sector buyers and consumers to pay more than they should for milling wheat and wheat-based foods.” – Vince Peterson, USW President, commenting on the April 18 WTO dispute panel ruling that China does not fairly administer its annual TRQ for imports of corn, rice and 9.64 million metric tons (MMT) of wheat. Read the full news release here.

Congratulations. We are fortunate to have devoted, loyal colleagues at USW. This month Accountant Ana Laura Salinas from the USW Mexico City Office is celebrating 20 years. Thank you, Ana Laura, for your service to our organization, to U.S. wheat farmers and to our customers around the world.

Our Sympathies. We have learned that William L. “Bill” Hulse of The Dalles, Ore., passed away in March at 98 years old. Mr. Hulse was the first Vice Chairman of USW, elected at the January 1980 meeting at which USW was established, and served as Chairman for 1981/82. During his chairmanship, the USW board hired the late Winston Wilson as President, who served until his retirement in 1997. Our condolences to Mr. Hulse’s family and friends.

Wheat Buyers from Morocco and Tunisia Visit Kansas and Texas. Wheat buyers from Morocco and Tunisia got a closer look at the intricacies and reliability of the U.S. grain infrastructure during their Cochran Fellowship Program experience in Kansas and Texas April 12 to 19. The program offers short-term training opportunities to agricultural professionals from middle-income countries, emerging markets and emerging democracies. Read the full story here.

2019 Borlaug CAST Communication Award. The Council for Agricultural Science and Technology (CAST) recognized Dr. Frank Mitloehner, professor and air quality specialist in cooperative extension in the College of Agricultural and Environmental Sciences at the University and California, Davis, with its 2019 Borlaug CAST Communication Award. This award is presented annually for outstanding achievement by a scientist, engineer, technologist or other professional working in the agricultural, environmental or food sectors for contributing to the advancement of science in the public policy arena. Read the full release here.

2017 Census of Agriculture Data Now Available. USDA announced the results of the 2017 Census of Agriculture Apr. 11, spanning some 6.4 million new points of information about America’s farms and ranches and those who operate them. Read the full release here.

Refined Grains and Health. A study showing that current guidelines on refined grains are misguided was recently published in a respected nutrition journal, Advances in Nutrition. The article, Perspective:  Refined Grains and Health:  Genuine Risk, or Guilt by Association? was developed by Dr. Glenn Gaesser, Director of the Healthy Lifestyles Research Center, at Arizona State University. Gaesser conducted a comprehensive literature review looking specifically at the relationship between refined (or enriched) grain intake and risk of major chronic diseases. Read the article here.

Cassidy Anderson Joins IGP Institute Team. The IGP Institute welcomes Kansas State University agribusiness graduate Cassidy Anderson, as the new distance education coordinator beginning May 20, 2019. Anderson first joined IGP as a student intern in 2016 and has since supported vital distance education activities. Read the full release here.

Baking with Hard Red Spring Wheat Flour Course. The Northern Crops Institute is hosting a course focused on hard red spring (HRS) wheat and flour May 14 to 17, 2019, at its facilities in Fargo, N.D. Participants will spend time in the baking laboratory, making pan breads, hamburger buns, hard rolls, bagels, pizza crusts, wheat-flour tortillas and more. Click here to learn more and register by April 22.

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.

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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By Claire Hutchins, USW Market Analyst

As marketing year (MY) 2018/19 draws to a close, customers of U.S. winter wheat are taking advantage of excellent buying opportunities on competitive pricing and high-quality, consistent supplies. Since the first week in January, the 2018/19 export sales pace for hard red winter (HRW) and soft red winter (SRW) surpassed last year’s pace for deliveries in the current marketing year (CMY) and the new marketing year (NMY).

According to USDA commercial sales data as of April 4, 2019, HRW sales for 2018/19 delivery total 8.70 million metric tons (MMT). That is down 4% from this time last year but up 4% from the 5-year average of 8.33 MMT. Between February 14 and April 4, weekly sales of HRW for CMY delivery were significantly higher than the same six weeks in 2017/18 on low prices and high crop quality attributes. In the April 12 U.S. Wheat Associates (USW) Price Report, estimated FOB export price for 12% protein HRW (12% moisture basis) out of the Gulf at $222/MT for May 2019 delivery compared to $258/MT for delivery in May 2018. HRW export basis for the same delivery month, at $1.70/bu, is significantly lower than last year’s $1.95/bu. In addition to lower FOB export prices, the 2018/19 HRW crop features excellent milling and baking qualities.

These market factors also support a significant uptick in HRW commercial sales into the NMY compared to NMY sales booked by the same time in 2017/18. HRW export sales for the 2019/20 marketing year total 396,000 metric tons (MT), up 64% from this time last year and 17% from the 5-year average. This represents the highest volume of HRW NMY sales to date since 2014/15. The most recent USW Price Report estimates 12% HRW FOB price for June 2019 delivery at $224/MT, compared to last year’s estimate of $259/MT for delivery in June 2018.

Members of the grain trade expect HRW FOB prices and export basis out of the Gulf to decrease steadily into the new marketing year on somewhat larger ending stocks, reduced inland logistical challenges, and favorable new crop conditions.

Turning to SRW, commercial sales to date for 2018/19 delivery total 3.30 MMT, up 36% year-over-year and 10% more than the 5-year average. This represents the highest volume of SRW commercial sales for CMY delivery since 2014/15. Competitive prices, higher than average protein levels and lower than average DON levels continue to elevate SRW export business through the second half of MY 2018/19. More information about the 2018/19 SRW crop is available at https://bit.ly/2ZdnMwi.

The latest USW Price Report valued the SRW export FOB price out of the Gulf at $204/MT for May 2019 delivery compared to $208/MT last year. SRW export basis for May 2019 delivery out of the Gulf at $0.90/bu is 5 cents less than last year’s estimate for May 2018 delivery.

Grain traders expect SRW FOB export prices and export basis to decline steadily into the first few months of MY 2019/20 despite tightening 2018/19 U.S. SRW ending stocks, which are forecast to fall to 4.57 MMT, 18% below 2017/18 and 7% below the 5-year average.

As with HRW sales, total SRW commercial sales for 2019/20 delivery are significantly higher than NMY sales booked this time last year. SRW commercial sales for NMY delivery total 302,000 MT, up 23% year-over-year and 15% from the 5-year average. This represents the highest volume SRW NMY sales to date since 2014/15 as customers look to lock in high quality supplies at globally competitive prices. The April 12 Price Report estimates SRW FOB price out of the Gulf for June 2019 delivery at $202/MT compared to last year’s estimate of $213/MT for the same delivery month in 2018.

 

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By Ben Conner, USW Vice President of Policy

The United States and Japan kicked off negotiations this week on a potential trade agreement between these two Pacific Rim economic giants. While the path forward for these negotiations is not yet clear, the pace is likely to speed up with a schedule of additional meetings between these traditional trading partners.

With the knowledge that U.S. farmers and their Japanese customers face significant challenges in the coming years, we were glad to see agriculture mentioned prominently in the U.S. Trade Representative (USTR) statement about the meetings.

USTR also reported that it raised the “very large trade deficit” with Japan as a primary area of concern. For U.S. agriculture, the concern is that the U.S. trade deficit with Japan seems poised to increase due to the disadvantage of being outside the Trans-Pacific Partnership (all other economic factors such as Japan’s significantly higher savings rate being equal). This month, in fact, Japan lowered its trade barriers further to imported agricultural products from many of the world’s major suppliers, but not the United States. Consequently, U.S. products, including wheat, are more expensive for Japanese importers.

U.S. Secretary of Agriculture Sonny Perdue has noted that there are two ways for other countries to shrink their deficit with the United States: buying more or selling less. His priority for overseas customers to buy more U.S. agriculture products. Here at U.S. Wheat Associates (USW), we strongly support that, but right now, in Japan, it is U.S. agriculture that is selling less.

The Trump Administration has described several trade policy problems facing U.S. industry. USW agrees with many and questions some, but we have strong hopes for an improved global trading system following the disruption that many see as necessary to rebalance trade relationships.

The Administration clearly has not forgotten U.S. agriculture, as the USTR statement proves. Concluding an agreement with Japan to offset the effects of withdrawing from TPP would be a crucial and welcome step toward demonstrating to U.S. farmers that their interests still matter.

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By Steve Mercer, USW Vice President of Communications

Grown in the eastern United States, soft red winter (SRW) wheat is a profitable choice for producing confectionary products like cookies (biscuits), crackers and cakes, and to blend its flour for baguettes and other bread products. U.S. Wheat Associates (USW) wants to share some key points about SRW exportable supply in marketing year 2018/19 and look ahead to its potential for 2019/20.

1. Good Quality. While excessive rain on the 2018/19 SRW crop did slightly lower average test weight and falling number, protein (9.9% on 12% moisture basis, composite) is above average and DON level (0.7 ppm composite) is slightly below average. Processors should find good qualities for crackers and segments of the crop with good cookie and cake qualities. The higher protein and good extensibility in the crop should add value in blending for baking applications. See more information at https://www.uswheat.org/market-and-crop-information/crop-quality/.

2. Least Cost. SRW is the lowest cost milling wheat in the world today, offered at an average FOB export price of US$202 per metric ton* for June delivery from U.S. Gulf ports. The International Grains Commission in its March Grain Market Report estimated SRW FOB price at $211, which is $6 less than French soft wheat. SRW exportable supplies are also available from Lakes ports (Toledo, Ohio), and Atlantic ports (Norfolk, Virginia, and Wilmington, North Carolina). See more information at https://www.uswheat.org/market-and-crop-information/price-reports/.

3. Supply is Down. Ending stocks of SRW have declined from 5.9 MMT in 2016/17 to USDA’s latest estimate of 4.6 MMT for 2018/19 (by comparison, SRW ending stocks in 2013/14 were 3.1 MMT after China imported 3.6 MMT that marketing year). Reduced supply relates to a near 50% decline in total production from 15.4 MMT in 2013/14 to USDA’s current estimate of 7.8 MMT in 2018/19, as well as an upturn in exports (see below). See more information at https://www.uswheat.org/market-and-crop-information/supply-and-demand/.

SRW ending stocks have declined steadily since 2016/17 on less production and more exports. Source: USDA

4. Demand is Up. As of April 4, SRW exports of 3.3 million metric tons (MMT) are 36% more than at the same time in marketing year 2017/18. This represents the most volume SRW sales year to date since 2014/15. Commercial SRW sales to Mexico, Colombia, Peru, Ecuador and Brazil are up significantly, as are imports by Central American and Caribbean countries and Nigeria. See more information at https://www.uswheat.org/market-and-crop-information/commercial-sales/.

U.S. SRW wheat supplies are down; export demand takes an upturn. Source: USDA

5. Planted Area is Down. In February 2018, USDA reported that SRW seeded area for 2019/20 is 5.7 million acres (2.4 million hectares), or down 7% from last marketing year. Most of the states that typically produce the most exportable SRW supplies planted less. This decline is not more significant only because some farmers can harvest SRW and then quickly plant soybeans to get a double crop from the same acre. In general, U.S. crop farmers, who are driven by economic circumstances to minimize their net losses at best this year, are turning away from winter wheat to other crops that offer better returns. Total U.S. winter wheat seeded area for 2019/20 is at its second lowest level on record. See more information at https://www.nass.usda.gov/Publications/Todays_Reports/reports/wtrc0219.pdf.

*Source: USW Price Report, April 12, 2019

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More than 90 U.S. wheat industry stakeholders will soon get a close-up view of the new wheat crop in Kansas, southern Nebraska, eastern Colorado and northern Oklahoma on the annual Wheat Quality Council (WQC) Hard Winter Wheat Tour April 29 to May 2. This tour and a second one in July focused on U.S. spring wheat are educational for the participants and news worthy as a first snapshot of each year’s new crops.

Tour participants come from as far away as Australia and represent all facets of the wheat industry, including millers, traders, media, farmers, researchers and government officials. By traveling across the region in scout teams that stop at random fields to evaluate crop progress and yield potential, they learn more what it takes for farmers to grow, manage, harvest and market the crop. U.S. Wheat Associates (USW) is sending two colleagues on the tour this year: Director of Programs Erica Oakley and Market Analyst Claire Hutchins.

Domestic and overseas buyers and end-produce processors pay close attention to personal observations and photos during the tour by following #wheattour19 on Twitter and Facebook, through summarized daily reports on Tuesday and Wednesday evenings and in the final report with an estimate of average yield per acre across the region.

The tour provides a statistically significant, early idea of what buyers can expect in new crop yields from the surveyed area. In 2018, for example, 24 WQC scout teams made evaluations at 644 fields and estimated average regional yield at 37 bushels per acre (49.2 kilograms per hectoliter). Official data from USDA’s National Agricultural Statistics Service estimated the average Kansas wheat yield in 2018 at 38 bushels per acre (50.5 kilograms per hectoliter). High Plains Journal posted more about the 2018 Hard Winter Wheat Tour by WQC Executive Vice President Dave Green at https://bit.ly/2XbAmu5.

Watch for observations from Anderson and Hutchins during this year’s tour on USW’s Facebook and Twitter pages and a full report of the 2019 tour May 2 in USW’s Wheat Letter blog.

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By Steve Wirsching, USW Vice President and West Coast Office Director

It is U.S. Wheat Associates’ (USW) mission to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” The overseas market has changed tremendously in the last 25 years. In the 1990s, the United States was a dominant global supplier. Today, it is one of many suppliers in a highly competitive international market. International trade has nearly doubled during that same time, driven by population and income growth. This growth has increased competition, elevating wheat quality as a vital component of value.

Russia now boasts that it exports more wheat than the United States. While Russia exports more tons, the United States continues to lead the world when sales are measured in dollars. In 2018, Russia exported $5.8 billion worth of wheat as compared to $6.1 billion exported by the United States. U.S. wheat commands a higher price in the international market because customers recognize its quality, consistency, and value.

In March, Wirsching participated on the Learning Session panel for “Putting Wheat Quality in the Spotlight ” at the 2019 Commodity Classic. His presentation focused on global markets for wheat, why growers should care about quality and selling their crop abroad.

USW supports the annual National Wheat Yield Contest sponsored by the National Wheat Foundation (NWF). Increasing wheat production is important to the long-term viability and competitive position of wheat as a food grain. However, wheat quality must not be compromised in exchange for higher yields. Growers need both higher yields and better quality. Along with the NWF and the National Association of Wheat Growers, USW recently helped sponsor a learning session, “Putting Quality in the Spotlight,” at the 2019 Commodity Classic in Orlando, Fla. The session focused on enhancing the message that quality is important. Panelists discussed why the top winning varieties should also be subject to minimum end-use functionality tests because some in the industry worry that the United States will adopt more wheat forage varieties to enhance yields, at the expense of quality. Farmers know you cannot sell something the customer does not need or want to buy. That is why quality is important.

Find more information about U.S. wheat quality and related resources here.

 

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By Elizabeth Westendorf, USW Assistant Director of Policy

Every year, U.S. Wheat Associates (USW) invites farmers (selected by state wheat commissions) to visit U.S. wheat customers overseas to learn more about international markets, customer needs, and the role of U.S. wheat in their businesses. This year, USW Assistant Director of Policy Elizabeth Westendorf led a team of three farmers to Spain, Portugal, and Morocco. The team included: Al Klempel, a hard red spring (HRS) and hard red winter (HRW) wheat farmer from Bloomfield, Mont. representing the Montana Wheat and Barley Committee; Kent Lorens, a HRW and hard white (HW) wheat farmer from Stratton, Neb., representing the Nebraska Wheat Board; and Casey Madsen, a HRW and HW wheat farmer from Pine Bluffs, Wyo., representing the Wyoming Wheat Marketing Commission.

They were accompanied by Ian Flagg, USW Regional Vice President for European, Middle Eastern and North African Regions and Rutger Koekoek, USW Regional Marketing Director, from the USW Rotterdam Office, as well as Mina El Hachimi, USW Director of Finance and Administration; Peter Lloyd, USW Regional Technical Director; and Tarik Gahi, USW Milling and Baking Technologist, from the USW Casablanca Office.

The 2019 USW EU-MEENA Board Team and USW staff in Spain during a visit with leadership from Harinas Polo and staff from the U.S. Embassy in front of the Harinas Polo mill.

In Spain, the team visited a pasta factory and several flour mills. They learned the importance of Spain’s growing pasta industry and visited a company capitalizing on health foods trends with innovative seeds and grains blends. The largest pasta producing company in Spain, Grupo Gallo, was the first to introduce semolina-based pasta to Spain in the 1960s when they brought durum wheat into the country. Prior to that, Spain only consumed pasta from common wheat. Today, Spanish millers value stability and consistency in the U.S. wheat they buy, and these qualities become even more important as companies continue to expand into convenience products. In Portugal, this theme of appreciating quality continued, with companies constantly seeking new ways to innovate in the market and distinguish their products from competitors.

After Portugal, the team left the EU to visit USW’s office and customers in Morocco. They met with Moroccan Office of Cereals (ONICL) and spoke about continued progress in implementation of the U.S.-Moroccan Free Trade Agreement, which includes a wheat tariff-rate quota. As in Spain and Portugal, Moroccan mills appreciate U.S. wheat quality, and companies targeting the high-quality niche market know they are well-served with U.S. wheat.

Visiting Kenz Maroc in Morocco. (L to R) Ian Flagg, USW Regional Vice President for European, Middle Eastern and North African Regions; Al Klempel, Montana; Casey Madsen, Wyoming; Kenz Maroc leadership; Kent Lorens, Nebraska; Mina El Hachimi, USW Director of Finance and Administration; Peter Lloyd, Regional Technical Director.

“The Moroccan market is very different from that of Spain or Portugal,” says Westendorf. “But the demand for high-quality wheat is still very evident and will continue to grow. We need to make sure that U.S. wheat maintains its reputation as the world’s most reliable choice by continuing to support our customers through trade and technical service, as well as varietal improvement programs.”

Al Klempel (Montana) and Casey Madsen (Wyoming) speak with Kenz Maroc leadership during a mill tour in Morocco.

In Morocco, the team also visited the Institut de Formation de l’Indstrie Meunière (IFIM), a milling school in Casablanca that USW started in partnership with the Moroccan Millers Federation in 1994. This school trains millers that work all over Africa and the Middle East, and the school is proud to continue partnering with USW to introduce students to the value of high-quality wheat in milling.

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

USW board teams provide a valuable experience for U.S. wheat farmers to see the hard work of our foreign offices and the results that work produces. It also allows U.S. wheat customers to meet with the farmers producing their wheat, and to better understand the strong value that farmers place on producing an excellent crop.

The team will report to the USW board of directors later this year. To see pictures from this and other Board Team trips, please visit the USW Facebook Page at https://www.facebook.com/uswheat/.

*Header Photo Caption: The 2019 USW EU-MEENA Board Team with USW and U.S. Embassy staff during a visit with the technical director of Grupo Gallo at its mill and pasta factory in Spain.

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Recent news and highlights from around the wheat industry.

Quote of the Week: “We have a plan, but it is only as good as the weather it is written on.” – Hurdsfield, North Dakota, farmer Jeff Mertz, discussing how he and his neighbors are preparing for what is likely to be a delayed planting season.

U.S. Wheat Exports Up this Week. USDA reported commercial net sales of 704,700 metric tons (MT) were reported for delivery in 2018/2019, up 48% from last week’s 475,000 MT and 70% from the estimated previous 4-week average of 457,000 MT. Sales were well above trade expectations of 300,000 to 600,000 MT. Increases were reported for Iraq (200,000 HRW), Egypt (-491 HRS, 120,000 SRW), Indonesia (80,000 HRS, 35,000 white), the Philippines (41,000 HRS, 29,000 white), and Mexico (37,355 HRW, 10,000 HRS, 15,121 SRW).

Pasta Production and Technology Course. The Northern Crops Institute is hosting a Pasta Production and Technology Course April 30 to May 2, 2019, at its facilities in Fargo, N.D. This course introduces participants to the fundamental and applied aspects of pasta production and quality. Click here to learn more and register by Monday, Apr. 8.

Baking with Hard Red Spring Wheat Flour Course. The Northern Crops Institute is hosting a course focused on hard red spring (HRS) wheat and flour May 14 to 17, 2019, at its facilities in Fargo, N.D. Participants will spend time in the baking laboratory, making pan breads, hamburger buns, hard rolls, bagels, pizza crusts, wheat-flour tortillas and more. Click here to learn more and register by Monday, Apr. 22.

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.

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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By Claire Hutchins, USW Market Analyst

(Revised April 5, 2019)

According to the March 29 USDA Prospective Plantings report, U.S. total spring-planted wheat area will fall to an estimated 14.2 million acres (5.75 million hectares), 7% below 2018/19, if realized. The estimate includes 12.4 million acres of hard red spring (HRS), down 2% from last year, if realized. USDA expects U.S. durum planted area to total 1.42 million acres (575,000 hectares), 25% below 2018/19 and 30% below the 5-year average. Farmers in the top four spring wheat producing states of North Dakota, Montana, South Dakota, and Minnesota are expected to decrease total spring wheat planted area year over year on price and weather concerns.

USDA expects a 150,000 acre (61,000 hectare) increase in North Dakota HRS area from 2018 to 6.7 million acres (2.71 million hectares), a 7% increase over the 5-year average, if realized. At the same time, USDA expects the state to decrease its planted durum area by 32% from last year. Currently, HRS commands a premium over durum at local elevators, prompting the decline in North Dakota’s durum planted area from 1.10 million acres (445,000 hectares) in 2018 to 750,000 acres (304,000 hectares) in 2019. Farmer frustration is evident in recent planting trends. In 2019, 11% of North Dakota spring wheat acres will go to durum compared to 23% in 2017.

Dr. Frayne Olson, crop economist and marketing specialist at North Dakota State University, told U.S. Wheat Associates (USW) the increase in HRS over durum planted area in the past few years is driven by the inversion in cash premiums for both classes.

“Four years ago, in 2015, farmers received $1.90 per bushel more for durum than HRS. And three years ago, in 2016, the durum premium over HRS was $1.20 per bushel,” Dr. Olson said. “Now, HRS commands a premium of between $0.12 per bushel to $0.41 per bushel premium over the top durum grade.”

USDA forecast Montana spring wheat planted area at 2.60 million acres (1.05 million hectares), down 10% from 2018/19. According to Cassidy Marn, marketing program manager with the Montana Wheat & Barley Committee, farmers are on track to begin planting by the third week in April, barring an unforeseen weather event, but are seeking more profitable alternatives to spring wheat. However, Marn added, more profitable choices are difficult to find because “the pulse market isn’t strong, and neither is the market for durum.” Mike Krueger, an independent market analyst based in North Dakota, suggests Montana farmers are more likely to leave would-be spring wheat acres fallow than to plant alternative crops like dry peas or barley.

Minnesota HRS planted area is expected to decrease 5% from 2018/19 levels to 1.53 million acres (62,000 hectares). Krueger believes the state’s final area planted to HRS in 2019 will fall below the USDA’s estimate due to price and weather concerns.

“In the fall, there was a lot of enthusiasm for HRS because the initial 2019 CRC insurance price for spring wheat is $5.77.  That compares to $6.31 a year ago,” Krueger said.

He believes Minnesota farmers will convert more 2019 spring wheat acres to soybeans because, despite trade disputes with China, the domestic soybean market is firmer on average than the markets for corn and wheat. Soybeans may be the most viable alternative if record precipitation keeps Minnesota farmers out of the fields for the next 20 to 30 days, forcing them out of the ideal spring wheat planting window.

Competitive Soybeans. Comparing average and recent cash prices, relative stability can offer an incentive for farmers in North Dakota and Minnesota to plant more soybeans than spring wheat. This year, wet conditions could also favor more soybean planting. 

 

South Dakota 2019/20 HRS planted area is forecast at 1.02 million acres (41,000 hectares), down 3% from last year. Reid Christopherson, executive director of the South Dakota Wheat Commission, said the USDA’s estimate may be a little optimistic given current weather and price conditions in the state. In the fall, producers were enthusiastic about converting harvested soybean acres to winter wheat, before extremely wet conditions delayed harvest and winter planting. Then, he said, hope for strong wheat markets persisted into the spring until the “bomb cyclone” hit the state, leaving many would be HRS acres buried under 30 to 43 cm. of snow. Now, he expects, spring wheat planting in South Dakota to be delayed until the third or fourth week in April. Christopherson said, “Late planting and low market prices will prompt producers to plant more row crops in 2019 than spring wheat, despite earlier intentions.”

On April 1, USDA also updated the country’s winter wheat planted area from the February forecast. Total U.S. winter wheat area is now expected to hit 31.5 million acres (12.8 million hectares), up 200,000 acres (81,000 hectares) from the February forecast, but still 3% below the planted area for 2018/19 harvest. USDA now forecasts HRW planted area at 22.4 million acres (9.07 million hectares), up slightly from the previous projection, but still 3% below the year prior and 10% below the 5-year average on delayed planting. Soft red winter (SRW) planted area for 2019 harvest decreased from the previous estimate to 5.55 million acres (2.25 million hectares), 5% below 2018/19 planted area. The first USDA Crop Progress report of 2019, released April 1, indicated 56% of the country’s winter wheat to be in good to excellent condition.

USDA expects white wheat acres, planted in both winter and spring, to fall to 3.9 million acres (1.57 million hectares) for 2019/20, down 5% from 2018/19 and the 5-year average of 4.1 million acres (1.66 million hectares). The U.S. Drought Monitor shows adequate moisture for wheat-growing regions clustered in northeastern Oregon, southeastern Washington and north-central Idaho. However, central Washington and Oregon are experiencing abnormally dry to moderate drought conditions. Still, USDA reported that the majority of the white wheat crop in those three states is in good to excellent condition.

Planted area reductions for all classes bring the total wheat planted area for 2019 harvest down to 45.8 million acres (18.5 million hectares), 4% below 2018 and 7% below the 5-year average, making this year’s total wheat planted area the lowest since USDA records began in 1919.