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U.S. Wheat Farmers Traveling to Spain, Portugal and Morocco to Meet with Customers

Customer service is defined as the process of ensuring customer satisfaction with a product or service. When it comes to international trade relationships, customer service is expanded to include managing relationships and being able to ensure a reliable, quality supply.

Twice every year, U.S. Associates (USW) sends U.S. wheat farmer leaders overseas to help cultivate relationships with the people who import, mill and use the wheat they grow. USW refers to these delegations as “Board Teams” because they typically include members of USW’s board of directors who are selected by state wheat commission members. These missions help strengthen customer relationships but also give the participants the chance to see how the organization and local USDA Foreign Agricultural Service (FAS) staff work together to represent U.S. farmers.

Bound this month for Spain, Portugal and Morocco, the next Board Team includes: Alan Klempel of Bloomfield, Mont., representing the Montana Wheat and Barley Committee; Kent Lorens of Stratton, Neb., representing the Nebraska Wheat Board; Casey Madsen of Pine Bluffs, Wyo., representing the Wyoming Wheat Marketing Commission; and team leader Elizabeth Westendorf, USW Assistant Director of Policy.

The team will also be joined by Ian Flagg, USW Regional Vice President for the European, Middle Eastern and North African Regions, as well as Rutger Koekoek, USW Regional Marketing Director. The visits to Spain and Portugal, which are part of the European Union, will provide an introduction to two sophisticated markets, where the United States is seeing increased competition from nearby exporting countries. In Morocco, where wheat imports are subject to tariff rate quotas (TRQs) under two separate trade agreements with the EU and the United States, the team will see how a government buying system works. Throughout the trip the team will have the opportunity to meet with several customers and government officials and tour many facilities.

The team members will report back to USW directors later this year and, as regional leaders, to their wheat farmer neighbors.

Photos and comments from the team’s activities will be posted on USW’s Facebook page at www.facebook/uswheat.

Al Klempel.

 

 

 

 

 

 

 

 

 

Kent Lorens.

 

 

 

 

 

 

 

Casey Madsen.

 

 

 

 

 

 

 

 

 

Elizabeth Westendorf.

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Main Takeaways from the USDA’s March 2019 World Wheat Supply and Demand Report

By Claire Hutchins, USW Market Analyst

USDA updated its monthly World Agricultural Supply and Demand Estimates (WASDE) on Mar. 8, showing decreased global production and domestic consumption but steady global trade. USDA pegged 2018/19 global production at 733 million metric tons (MMT), 3 percent below last year’s volume of 763 MMT. The United States holds the most exportable supplies at 51 MMT, while Russia’s fall in at 43 MMT, Canada’s at 28 MMT, and the European Union’s (EU) at 27 MMT.

Global consumption estimates dropped by 5 MMT between February and March to 742 MMT, driven primarily by a 3 percent decrease in expected Indian domestic consumption for 2018/19. Indian wheat consumption will account for nearly 13 percent of total global consumption in 2018/19, while its final import levels will make up less than 1 percent of expected global wheat imports. Though 2018/19 global consumption is expected to fall below last year’s record of 744 MMT, total global trade holds nearly as high as 2017/18 levels at 179 MMT, 3 percent above the 5-year average of 173 MMT.

The EU and Argentina are expected to export 23.0 MMT and 14.2 MMT respectively, both upward revisions from February’s WASDE report. USDA lowered its 2018/19 U.S. wheat export estimate to 26.3 MMT, down 3 percent from the February estimate of 27.2 MMT. USDA dropped expected hard red spring exports by 680,000 metric tons (MT) to 7.48 MMT and white (soft white and hard white) exports by 272,000 MT to 5.72 MMT. Year-to-date commercial sales of 22.6 MMT comprise 86 percent of the USDA’s new 2018/19 export figure. This time last year, USDA expected U.S. wheat exports to total 25.2 MMT. Commercial sales a year ago totaled 22.1 MMT, or 88 percent of USDA’s 2017/18 total expected export volume as of March 2018. With 12 weeks left to go of marketing year 2018/19, the United States must sell 3.7 MMT of wheat to hit the USDA’s current export projection.

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

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Precision Agriculture Advances Sustainable Wheat Production

By Steve Mercer, USW Vice President of Communications

No two wheat fields in the world are alike. The fact is, there can be wide variations within a field or even a very small sections of a field.

Not that long ago, farmers had limited ability to change production strategies in ways that more directly correlated with this natural variability. Now, however, farmers in the United States and around the world have high-technology systems that allow them to instantly adjust seed, fertilizer and crop protection inputs with near pinpoint accuracy, ensuring the right rates are applied or seeded in the right location while on the go in their field.

According to information from “Let’s Grow Together,” an online information source in Washington state to help consumers better understand agriculture, “farmers collect information using crop yield monitors, soil maps and global positioning systems (GPS). The yield monitor measures the amount of wheat harvested and the GPS uses satellite signals to track the exact location where the yield measurements were taken.”

The resource notes that software creates a detailed map of high- and low-yield zones. Using enhanced GPS guidance systems, the wheat farmer can operate seeding and application equipment with as little as 2.5 centimeters (about one inch) of overlap. Such precision drastically reduces waste and the unnecessary application of fertilizer and crop protection products.

“I believe this technology makes us far more efficient,” said Janice Mattson, who with her family grows hard red winter and hard red spring wheat in Montana’s “Golden Triangle” region. “There is a financial benefit in using only what we need, but we also see environmental benefits on our own land, in our communities and for our customers.”

 

Janice Mattson sees environmental benefits from precision agriculture.

 

U.S. farmers know that seeking ways to improve the sustainability of the crop and environment is increasingly important to the world’s buyers and wheat food processors.

Jeff Newtson, who with his family grows soft white wheat in northeastern Oregon, says technology like satellite imagery of crops helps them vary the rate of fertilizer across the hilly terrain of their farm to produce more uniform wheat.

 

Jeff Newtson says precision agriculture helps his family produce a more consistent soft white wheat crop for overseas buyers.

 

“We know that our customers want high-quality food products and 90 percent of the wheat we grow is exported,” said Newtson. “They come from overseas to support our farm and our families, so we have to give them a good product in return.”

“We have changed and adapted and we will keep changing and adapting,” said David Clough, who grows hard red spring wheat in central North Dakota. “We are doing that to survive economically and to keep our land in good shape for future generations.”

 

David Clough says farmers will keep changing and adapting to survive economically and keep their land in good shape.

 

“First and foremost, sustainability is economical and generational, which leads to environmental sustainability,” said Mark Linnebur, a family farmer from Byers, Colo.

His family’s focus on applying high-technology and no-tillage systems as well as other practices is all about being good stewards of the land.

“We are not trying to mine the land for what we can get out of it in the near term,” he said, “because we want to pass it on to our children.”

 

Mark Linnebur says sustainability on the farm is economic and generational.

 

Caption for image at the top of this page: Precision agriculture is allowing farmers to adjust inputs to near pinpoint accuracy, enhancing sustainable wheat production. Photo copyright “Let’s Grow Together.”

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Wheat Industry News

Recent news and highlights from around the wheat industry.

Quote of the Week: “The most valuable commodity in the world is integrity.”  — Peter Lloyd, USW Regional Technical Director, USW/Casablanca. Read the full story here.

How the United States Uses Its Land. There are many statistical measures that show productivity, but what can be harder to decipher is how a country uses its land. Bloomberg in 2018 created maps that give a general sense of how land in the United States is used for cropland, pasture, forest, special use and urban living. Agricultural land takes up about 20 percent of the country and it takes about 21.5 million acres (8.7 million hectares) to produce all the U.S. wheat exported in one year. Click here to view the Bloomberg maps.

Congratulations New NAWG Officers. The National Association of Wheat Growers (NAWG) recently elected officers for 2019/20. Texas wheat farmer Ben Scholz will serve as President, Michigan wheat farmer David Milligan as Vice President, Washington state wheat farmer Nicole Berg as Treasurer and Oregon wheat farmer Brent Cheyne as Secretary. Now Past-President Jimmie Musick of Oklahoma will continue to serve on NAWG’s executive committee. USW wants to thank Jimmie for his strong support of export development and his hard work for wheat farmers, and we congratulate his fellow officers on their election. Click here to read the full release.

NAWG Endorses USMCA. NAWG recently joined The National Corn Growers Association, American Soybean Association, and National Sorghum Producers in support for the pending U.S.-Mexico-Canada Agreement (USMCA). Mexico and Canada account for 25 percent of all U.S. agriculture exports and USMCA preserves and builds upon the existing trading relationship between the United States, Canada and Mexico, the organizations said in a news release. They will be advocating members of Congress to ratify USMCA this year, while also urging the Trump Administration to keep the current NAFTA agreement intact until the new agreement is ratified. Click here to read the full release.

Group Calls on USDA to Support Export Development in Cuba. In a recent letter, the United States Agriculture Coalition for Cuba urged U.S. Secretary of Agriculture Sonny Perdue to approve the use of USDA Foreign Agricultural Service export market development funds in Cuba to promote, educate and carry out research supporting U.S. agricultural goods. The USACC represents more than 100 agricultural commodity and farm member organizations, including USW and NAWG, that support improving rural economies and enhancing opportunities for U.S. agriculture through normalized trade with Cuba. Click here to read the letter.

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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U.S. Wheat Farmers See Opportunity for Growth in Southeast Asia Markets

By Catherine Miller, USW Programs and Planning Coordinator

Every year, U.S. Wheat Associates (USW) invites farmers (selected by state wheat commissions) to participate in a “Board Team” trip overseas to follow their wheat and learn from customers about the quality characteristics needed in those markets. In February the first USW Board Team of 2019 traveled to Southeast Asia—one of the largest and fastest growing wheat import regions. Stops in the Republic of the Philippines, Singapore and Indonesia gave the team the opportunity to visit important markets and learn more about how wheat-based products are re-shaping consumer demand.

The 2019 USW Southeast Asia Board Team included Joe Anderson of Lewiston, Idaho, representing the Idaho Wheat Commission; Wally Powell of Condon, Ore., representing the Oregon Wheat Commission; Philip Volk, of York, N.D., representing the North Dakota Wheat Commission; and team leader Catherine Miller, USW Program and Planning Coordinator.

In the Philippines, the team enjoyed a meeting and tour with Wellington Flour Mills. They were joined by company President Ty Weevens (center, front row), whose grandparents originally start the family-owned mill, along with a few cousins who are also apart of the mill’s operations.

In Manila, Republic of the Philippines, the team met with traders, millers and bakers. Each meeting focused on the importance of high-quality wheat to create high quality end-products. The team visited a flour mill, as well as an industrial cracker facility. The team found a common theme that consumers here are looking for more convenience and shifting from traditionally rice-based staple foods to more wheat and grain-based meals. This is a huge market driver for a variety of cookies, crackers and bread products.

“One of our lunches with USW staff and four different mills was one of the highlights,” said Powell. “It was so beneficial to spend that time with them and share a meal.”

Lunch with grain traders in the Philippines.

One of the highlights in Manila was attending the 10th International Exhibition on Bakery, Confectionery and Foodservice Equipment and Supplies, known as “Bakery Fair 2019,” hosted by the Filipino-Chinese Bakery Association Inc. While visiting different exhibits, labeling on some of the flour bags stood out to Anderson: “They said ‘Certified U.S. Wheat.’ That shows the success USW has had building a preference for our wheat, and I’m proud of that.”

In Singapore, the team members next visited a bakery training and supply company. They also had briefings from USW/Singapore regional staff member, who demonstrated how producer-funded USW activities are carried out in the region and how USW works together with local USDA Foreign Agricultural Service (FAS) staff to represent U.S. farmers.

Next, the team traveled to Jakarta, Indonesia, where they met with the largest flour mill in the world, as well as three competing milling companies. The contrast in bakeries between the Philippines and Indonesia, where small-medium end-user enterprises (SME’s) dominate 67 percent the market, was quite clear.

“This was one of the biggest surprises for me, especially since these SME’s sometimes only use one 25 kilogram bag of flour per day,” said Anderson.

During their visit to Indonesia, the team visited Dynamic Bakery, which is a customer of Bogasari, the largest flour mill in Indonesia.

The team toured three of those bakeries in Jakarta. SME’s vary from home-based bakeries to medium scale businesses with a store front. The at-home bakeries were truly unique, and the importance of these niche producers really resonated with the group.

In such a rapidly growing wheat foods market, there are fears that “Indonesia will run out of milling capacity within the next few years if markets keep growing at the present pace,” according to one milling executive. One reason: the cost of production is a limiting factor; logistics alone make up 10 percent of variable costs.

At another flour mill, the group learned more about current market trends. In Indonesia, about 50 percent of flour in the market goes to instant noodle production. Currently, noodle production is met largely with flour from Australian white wheat. However, the team was told there is at least a window of opportunity for U.S. hard red winter wheat, especially given the recent production challenges that have significantly bumped up Australian wheat import prices.

During their visit to Indonesia, the team visited and toured Bogasari, the country’s largest flour mill, which has approximately 50% of the country’s market share. They were also joined in Indonesia by Matt Weimar, USW Regional Vice President for South Asia; and Ivan Goh, USW Biscuit/Bakery and Noodle Technologist.

“It was clear that the uncertainty of low margins and where the price of wheat will be next year was an overall concern for all markets” said Volk. “This just proves that overall U.S. wheat quality needs to be consistent from year to year.”

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: Visit to MY San – the market leading biscuit company in the Philippines. Mt. Makiling is in the background. (L to R) Phil Volk, North Dakota Wheat Commission; Joe Anderson, Idaho Wheat Commission; Catherine Miller, USW Programs and Planning Coordinator; Wally Powell, Oregon Wheat Commission; and Joe Sowers, USW Regional Vice President for Philippines and Korea.

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U.S. Wheat Export Pace Quickens

By Claire Hutchins, USW Market Analyst

As wheat futures hit contract lows, trade negotiations with China wind on and the window for export sales delivered in marketing year 2018/19 (June to May) draws to a close, U.S. Wheat Associates (USW) sees a more optimistic picture in the U.S. Department of Agriculture’s (USDA) most recent series of commercial sales data.

During and after the partial U.S. government shutdown, which spanned from Dec. 22, 2018, to Jan. 25, 2019, industry “buzz” was increasingly skeptical that the United States would hit the USDA’s 2018/19 wheat exports projection of 27.2 million metrics tons (MMT). Given that the USDA’s final commercial sales release before the shutdown (as of Dec. 13, 2018) revealed a 12 percent lag in the year-to-date export pace in December 2017, implying a U.S. export pace of 438,800 metrics tons (MT) per week would be needed to hit USDA’s final trade estimate, numerous trade stories that circulated in January and February did little to mitigate industry consensus.

However, actual sales data gathered during and after the shutdown and released in late February revealed a far more robust trade environment for U.S. wheat. When up-to-date commercial sales information emerged again, it revealed a remarkable uptick in weekly average wheat exports compared to the same six weeks in 2017/18. Significantly, the numbers showed U.S. wheat exports surpassed last year’s year-to-date sales in a matter of weeks despite uncertainty surrounding the partial government shutdown, delayed USDA reports, domestic weather and transportation issues, and virtually no access to the Chinese market.

Total exports between Jan. 4 and Feb. 14, 2019, reported on Feb. 22, 2019, totaled 3.57 million metric tons (MMT), which is more than double the accrued export level during the same time last year. In 2017/18, the weekly average export volume totaled 292,000 metric tons (MT) during the six weeks in question. While exact total sales per week between Jan. 4 and Feb. 14, 2019, are unreported, the weekly average sales pace (3.57 MMT divided by six) hit nearly 600,000 MT. A similarly high export pace continued between Feb. 15 and Feb. 21 and totaled 476,400 MT, a 149 percent increase over the same week in 2018. Between Dec. 13, 2018, and Feb. 21, 2019, the United States averaged 582,343 MT per week in commercial sales.

 

 

To date, U.S. commercial sales of wheat for marketing year 2018/19 total 22.0 MMT, 81 percent of the USDA’s total projected exports and 2 percent ahead of last year’s commercial sales pace. With 13 weeks left in marketing year 2018/19, the United States must now export, on average, 403,077 MT per week to hit the USDA’s final export projection of 27.2 MMT, or 8 percent less per week than was required as of mid-December.

USW cannot predict the future pace of U.S. wheat export sales, but the new data does call into question some pessimism about USDA’s sales 2018/19 estimate. If U.S. FOB prices remain more cost-competitive and late-season logistical challenges ease, the United States is in a better position than before to hit the USDA’s wheat export prediction of 27.2 MMT by May 31, 2019.

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Meet the USW Technical Experts: Peter Lloyd – International Man of Milling

Name: Peter Lloyd

Title: Regional Technical Director

Office: USW Middle Eastern, East and North African Region, Casablanca Office

Providing Service to: North Africa and the Middle East

Peter Lloyd’s eyes lit up the moment he saw the MIAG pilot flour mill and baking lab at Mennel Milling‘s Fostoria, Ohio, plant.

Lloyd, who was with U.S. Wheat Associates (USW) colleagues gathering information on new U.S. wheat export opportunities, said: “there is no end to that plant’s potential in soft wheat product development.”

That is strong praise coming from someone who has designed, serviced, and visited more flour mills worldwide than he can count. Lloyd’s USW title of Regional Technical Director does not do justice to his global responsibilities. Based in USW’s office in Casablanca, Morocco, Lloyd travels the world to conduct technical support that helps prove the value of U.S. wheat in the customer’s mill.

“I believe the work I do and that my USW colleagues and consultants do brings the greatest value where it makes the most difference — on the bottom line profit for a supply chain manager, miller or baker,” Lloyd noted. “A clear knowledge of the customer’s business is also vitally important to opening the door to U.S. wheat farmers as valued suppliers.”

Peter Lloyd; Marcelo Mitre, Technical Specialist, USW/Mexico City; Dr. Byung-Kee Baik, Acting Research Leader, USDA-ARS, Wooster, Ohio; Brad Moffitt, Director of Market Development and Membership, Ohio Small Grains Marketing, Program; Tarik Gahi, Milling & Baking Technologist, USW/Casablanca. February 2016 at the USDA-ARS Soft Wheat Quality Laboratory, Wooster, Ohio.

A Storied Career

Just a thumbnail of Lloyd’s professional credentials would be enough to open that door, starting with his British father’s successful flour milling career that took him from Liverpool to Kenya, where Lloyd was born. Intrigued by his youthful visits to mills with his father, Lloyd decided to follow him into the business in 1977.

Milling engineering training and working with Henry Simon in the United Kingdom and South Africa built the foundation for Lloyd to become a mill manager in Botswana in his mid-20s. He returned to the UK with the Simon Group in an engineering sales position in 1986 that, along with his emerging knowledge of high technology applications, led to a job with the United Milling Systems division of the Carlsberg Research Center in Denmark. Lloyd eventually started his own consulting business that continued his work in Africa.

“Then, in 1991, I saw an advertisement in World Grain magazine for the post of Dean of the new Egyptian Milling School in Cairo from an organization called U.S. Wheat Associates,” Lloyd recalled.

Peter Lloyd, left, discusses soft red winter wheat variety development with Dr. Clay Sneller, Associate Professor, Dept. Horticulture and Crop Science, The Ohio State University, Tarik Gahi, USW/Casablanca and Dr. Byung-Kee Baik, Director, USDA-ARS Soft Wheat Quality Laboratory, Feb. 2016, Wooster, OH.

Per its agreement with its Egyptian business partners at the time, USW had management responsibilities for the school’s development and first two years of operation. Lloyd applied for and eventually earned the position where he directed construction and curriculum development — and discovered a love of teaching. Moreover, he was impressed by USW’s approach to export market development.

“Building trust is crucial, and I think USW’s biggest asset is not having sales objectives. We give advice based upon its merit only,” Lloyd observed. “From U.S. wheat farms to the school in Cairo, we were truly committed to forging a long-term partnership with overseas customers, offering technical assistance without a commercial profit motive.”

USW’s substantial funding for the school ended in 1994, and Lloyd moved on to a technical support position in Egypt with the Australian Wheat Board (AWB), which was, at the time, a fully governmental organization. After the organization was privatized, Lloyd said the drive to meet sales goals, and quarterly returns did not match his values. A return to consulting in the Middle East, including for USW, opened an opportunity to join the Wheat Marketing Center (WMC) in Portland, Ore., in 1996.

L-R: Nihal Habib, formerly with USW/Cairo; Peter Lloyd; Hoda Moawad, formerly with USW/Cairo; two Egyptian grain officials; Tarik Gahi, USW/Casablanca, at a USW Buyers Conference in Sharm El Sheikh, Egypt, 2013.

“Working with the director Bob Drynan (who had also worked for USW and the California Wheat Commission), wheat growers, the grain trade, and the researchers at USDA and Washington State University was one of the most enjoyable periods in my career,” Lloyd recalled. “Perhaps most significant in terms of my future work with USW was the interaction with Asian millers and bakers to learn about the product quality and diversity in their markets.”

An Invaluable Resource

After personal choices drew him back to the UK and consulting work in 1998, Lloyd answered another call from USW to help address some challenges at the new IFIM Milling School in Casablanca. That role grew into a longer-term opportunity to implement a Miller Outreach Program with the goal of building professional expertise and a greater understanding of U.S. wheat quality and value in North Africa and the Middle East through the IFIM school.

“That was very rewarding, but I recognized I needed to get reacquainted with the latest mill operations and moved to a technical milling position in Dubai for two years,” Lloyd said. “In 2005, I returned to USW to run the Tunisian Outreach Program and served in Tunis until 2009. During this time, we expanded the technical assistance role from Tunis to many of the other USW offices in Asia, the Middle East, and North Africa, as well as supporting the opening of new markets in Libya and Algeria at that time.”

Though much has changed in the last ten years, including his move to USW’s Casablanca, Morocco, office, Lloyd’s work with USW in North and South Asia, the Middle East, Africa, and occasionally Latin America and Europe in support of U.S. wheat export market development continues today.

Peter Lloyd providing technical support at a Colombian flour mill, October 2009.

“Our objective remains the success of the people we support,” he asserted. “Why? Because successful millers and bakers are most likely to buy what we have to offer: high-quality wheat from high-quality farmers to produce high-quality flour for high-quality products.”

The beneficiaries of his work agree.

“Peter Lloyd has been an invaluable resource for us for the better part of 10 years, giving advice ranging from mill cleanliness and fumigation to more complex topics like milling economics and flour customization,” said an executive with a large flour milling company in the Philippines. “We cannot thank him enough for all his help. He is a true encyclopedia of flour milling.”

A Chinese milling executive said Lloyd’s efforts helped his team better understand the processing characteristics of the individual classes of U.S. wheat.

Peter Lloyd, current President Vince Peterson, and customers at USW Middle Eastern Grain Buyers Conference, Sharm El Sheikh, Egypt, 2009.

“His constructive opinions on our production process have helped us be more efficient in milling U.S. wheat and helped improve the competitiveness of our flour products,” the executive concluded.

“USW is so lucky to have such a talented, charismatic individual like Peter on our staff,” said USW Regional Vice President Ian Flagg, who directs export market development activities in North Africa, the Middle East, and Europe. “Not only is Peter a great technical asset, he is completely committed to our mission to return value to the farmers we represent and their customers, and that is what he does all over the world.”

“I am doing exactly what I want to be doing at this point in my career with and for some of the nicest people on Earth,” Lloyd said. “Our customers welcome us to their offices, listen to what we have to say, and trust us. Then coming back months later and finding that we helped them improve their business is very rewarding. And the U.S. wheat farmers we work for represent values I hold in the highest esteem: honesty, integrity, human decency, hard work, a love of the land, and a deep respect for our Creator.”

He also remains very upbeat about the global wheat industry.

“End products are made from flour, not whole wheat kernels, so the growth of the milling and food processing industries are inextricably linked,” Lloyd noted. “As much as any foodstuff, wheat-based products have a prominent place in shopping baskets in every country of the world, and for every income group for the foreseeable future — and there are more and more shoppers every day.”

Peter Lloyd visits Mennel Milling, Fostoria, Ohio, Feb. 2016

Peter Lloyd visits Mennel Milling, Fostoria, Ohio, Feb. 2016

By Steve Mercer, USW Vice President of Communications

Editor’s Note: This is the second 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.”

Header Photo Caption: Peter Lloyd’s presentation at the 2015 USW Crop Quality Seminar, Cairo, Egypt

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
Marcelo Mitre – A Love of Food and Technology that Bakes in Value and Loyalty
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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The Benefits of U.S. Investment in Global Wheat Research Collaboration

By Elizabeth Westendorf, USW Assistant Director of Policy

Seventy-five years ago, the seeds of the Green Revolution were planted when Norman Borlaug began his work on wheat breeding in Mexico. The success of that effort, which was a partnership between the Mexican government and the Rockefeller Foundation, led to the eventual founding of the International Maize and Wheat Improvement Center (CIMMYT).

In 1971, CGIAR was established as an umbrella organization to create an international consortium of research centers. CIMMYT was one of the first research centers supported through the CGIAR, which today includes 15 centers around the world with a local presence in 70 countries. Each center focuses on unique challenges, but they are all driven by three broad strategic goals: to reduce poverty; to improve food and nutrition security; and to improve natural resources and ecosystem services.

For 50 years, wheat has been one of the core crops of CGIAR’s focus. CGIAR receives annual funding of about $30 million for wheat, and the economic benefits of that wheat breeding research range from $2.2 to $3.1 billion. This is a benefit-cost ratio of at least 73 to 1 — for every $1 spent in CGIAR wheat research funding, there is more than $73 in economic benefits to global wheat farmers. CIMMYT’s international wheat improvement programs generate $500 million per year in economic benefits. Globally, nearly half of the wheat varieties planted are CGIAR-related; in South, Central and West Asia and North Africa, that number rises to 70 to 80 percent of wheat varieties. When wheat supplies 20 percent of protein and calories in diets worldwide, CGIAR wheat research can have a major impact on the livelihoods of the world’s most poor people.

CGIAR Research Centers have also led to significant benefits for U.S. farmers as well. Approximately 60 percent of the wheat acreage planted in the U.S. uses CGIAR-related wheat varieties. CIMMYT wheat improvement spillovers in the United States repay the total U.S. contribution to CIMMYT’s wheat improvement research budget by a rate of up to 40 to 1. Another partner, the International Center for Agricultural Research in the Dry Areas (ICARDA), has delivered innovations that protect U.S. farmers from crop losses due to destructive pests, and has also partnered with CIMMYT to develop the One Global Wheat Program under CGIAR.

One aspect of the CGIAR success story in the United States is about partnership. Public U.S. universities around the country have partnered with CGIAR on agricultural research, to the benefit of U.S. farmers and farmers worldwide. This partnership allows for knowledge transfer and idea-sharing on a global scale. USW is proud that many of our member states have universities that have partnered with CGIAR on wheat projects.

The news is not all good, however. As we anticipate world population growing to 10 billion in 2050, the demand for wheat is expected to increase by 50 percent. To meet that demand, wheat yields must increase by 1.6 percent annually. Currently they are increasing by less than 1 percent annually. There is plenty of work to do to continue Borlaug’s mission of achieving food security. CGIAR Research Centers will continue to play a critical role in that effort.

The United States’ investment in CGIAR Research Programs makes a vital contribution to agricultural improvements and fosters partnerships with U.S. public research universities, international research centers, private sector partnerships and others. Partnerships with CGIAR make it possible to do the win-win collaborative wheat research that helps meet global food needs, brings tremendous economic benefits to U.S. agriculture and leverages U.S. research dollars.

We invite our stakeholders and overseas customers to learn more about this important partnership and the benefits of CGIAR wheat research in part through a fact sheet posted here on the USW website.

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Positioned to Return More Value to Wheat Buyers and Producers

By Vince Peterson, USW President

Recently, I was searching online for some wheat market information to share at an upcoming meeting. I saw a headline that asked: “What country exports the most wheat?” Great, I thought, here we go again with more propaganda about Russia beating the United States in the global wheat export market contest.

Instead, I was quite pleased to scroll down to find that the United States was still the world’s largest wheat exporter in 2017 in terms of “value” according to the “World’s Top Exporters.” Russia produced almost twice the volume of wheat than the United States and more than matched U.S. export volume that year; but at an estimated $6.1 billion, U.S. wheat exports generated $300 million more value than Russian wheat exports.

The reason is clear: there are many private and public wheat buyers, millers and processors around the world that prefer the quality, variety and value of U.S. wheat; and that remains a primary asset to our farmers.

U.S. Wheat Associates (USW) has adjusted its allocation of wheat farmer dollars and program funds from USDA’s Foreign Agricultural Service to activities in markets that have a growing need for a variety of flour products with high quality functional characteristics. There our differential advantages shine through and where the investment offers the most return. On the other hand, USW continues to provide the trade servicing needed in the more cost-sensitive markets that are buying Russian wheat. There is value there, too, with a market environment like today’s in which the price spread between U.S. wheat classes and Black Sea supplies has narrowed. We continue to provide technical support to those buyers to demonstrate and build more knowledge about the true functional value of U.S. wheat. In addition, we are strong advocates for continuous improvement in wheat quality.

Looking ahead, I believe this is the right position for U.S. wheat in a global market with growing income levels, increasing urbanization and record setting consumption every year. It also reflects our mission: to enhance wheat’s profitability for U.S. producers and its value for their customers.

 

USW President Vince Peterson

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Wheat Industry News

Recent news and highlights from around the wheat industry.

Quote of the Week: “Obviously we hope that the trade environment improves soon but in the meantime, these funds will allow USW to increase marketing efforts and work on expanding markets in our key customer regions. Some of our largest, highest value markets took decades to build and we need to preserve those relationships to the best of our ability, while exploring new market opportunities…” — Bruce Freitag, a wheat farmer from North Dakota and Chairman of the North Dakota Wheat Commission, discussing new funding for export market development awarded by USDA. Read the full release here.

Two Changes to Official Falling Number Determination for Wheat. The USDA Federal Grain Inspection Service (FGIS) plans changes to the Falling Number test to reduce inconsistency and variability in test results. Changes are a result of research work undertaken after farmers encountered a significant falling number problem in parts of the Pacific Northwest (PNW) in 2016 and increased efforts to reduce inconsistent results across FGIS lab locations. Learn more here. 

Minnesota Wheat Accepting Applications for Executive Director. The Minnesota Wheat Research and Promotion Council (MWRPC) and the Minnesota Association of Wheat Growers (MAWG) are seeking candidates to succeed long-time Executive Director Dave Torgerson. After serving the two organizations and Minnesota wheat growers for over 30 years, Torgerson will retire on March 31, 2019. Click here for more information.

Buhler-KSU Milling Short Courses. The IGP Institute offers milling courses this spring at its campus in Manhattan, Kan., including: The Buhler-KSU Expert Milling course, offered in English March 4 to 8, 2019, and in Spanish March 11 to 15, 2019; the Buhler-KSU Executive Milling course, offered in English May 20 to 24, 2019. Click here to register for these courses.

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, ND. This course introduces participants to the fundamental and applied aspects of pasta production and quality. Click here to learn more 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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