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U.S. Wheat Associates (USW) is the industry’s market development organization working in more than 100 countries. Its mission is to “develop, maintain and expand international markets to enhance the profitability of U.S. wheat producers and their customers.” USW activities are funded by producer checkoff dollars managed by 18 state wheat commissions and USDA Foreign Agricultural Service cost-share programs. For more information, visit www.uswheat.org or contact your state wheat commission. Stakeholders may reprint original articles from Wheat Letter with source attribution. Click here to subscribe or unsubscribe to Wheat Letter.

In This Issue:
1. Lower U.S. Wheat Production in 2016/17 to Have Limited Effect on Global Demand
2. U.S. Wheat Sustainability is In the Details
3. Global and Domestic Perspectives on How Best to Meet the Growing Demand for Food
4. USDA-ARS Soft Wheat Quality Lab, Breeders Work to Improve Soft Red Winter Wheat Quality
5. New Wheat Foods Council Promotion Plan May Spark Ideas for Overseas Markets
6. Wheat Industry News

Online Edition: Wheat Letter – March 10, 2016 (See attached file: Wheat Letter - March 10, 2016.pdf)

USW Price Reports: http://www.uswheat.org/prices


1. Lower U.S. Wheat Production in 2016/17 to Have Limited Effect on Global Demand
By Stephanie Bryant-Erdmann, USW Market Analyst

This year, U.S. wheat planted area will fall to the lowest level since 1970, according to Mark Simone of the Foreign Agricultural Service (FAS). The USDA held its annual Agricultural Outlook Forum on Feb. 25 to 26 where Simone presented the 2016 Grain and Oilseeds outlook. USDA currently estimates 2016/17 (June to May) wheat acreage at 51.0 million acres, a six percent decrease from last year.

Winter wheat plantings are down 7 percent according to USDA, with the hard red winter (HRW) crop having the largest decrease. HRW plantings fell by nine percent to 26.5 million acres. Soft red winter (SRW) plantings decreased by 400,000 acres to 6.7 million acres. USDA anticipates a 5 percent reduction in spring wheat plantings due to more favorable returns for other commodities. Currently, USDA’s spring wheat and durum acreage projection stands at 14.4 million acres, down from 15.1 million acres last year.

Due to the expected reduction in planted area, production will decrease for HRW, hard red spring (HRS) and durum despite a predicted increase in average wheat yields. USDA expects white wheat production to increase slightly due to a small increase in planted area and more favorable growing conditions. SRW production will remain flat with an expected increase in yield predicted to offset the lower planted area. Based on trend yields, USDA expects the national average yield to grow to 45.9 bushels per acre. USDA projects the wheat harvested-to-planted ratio will fall to 0.85, down slightly from last year’s 0.86 due to a small increase in expected abandonment rates.

Although planted area is down for winter wheat, current crop conditions for many HRW-producing states are significantly better than this time last year, with 57 percent of the total HRW crop in either good or excellent condition compared to 44 percent last year. However, warm temperatures brought wheat out of dormancy earlier than normal across much of the HRW growing region, increasing the plants’ need for water and vulnerability to a late-spring freeze. Current SRW crop conditions also improved from last year with 58 percent of the crop in either good or excellent condition in Illinois, the only SRW state for which data is available at this time. USDA weekly crop progress reports will resume on April 4.

An increase in carryover stocks will push total U.S. supplies higher in 2016/17. USDA forecasts 2016/17 U.S. supplies at 83.9 million metric tons (MMT), up 5 percent from 2015/16 and 2 percent more than the 5-year average, if realized. Demand in the U.S. will grow in 2016/17, with USDA anticipating a 5 percent increase in domestic use, from 32.2 MMT to 33.8 MMT.

Price competition from other wheat exporters will continue to pressure demand for U.S. wheat, in spite of an anticipated decrease in world wheat production after three consecutive record crops. However, USDA expects U.S. exports to rebound a bit to 23.1 MMT, up 6 percent from the forecasted 2015/16 U.S. wheat export level of 21.1 MMT.

To read more from the USDA Outlook Forum or to download presentations, please visit http://www.usda.gov/oce/forum/.


2. U.S. Wheat Sustainability is In the Details
By Elizabeth Westendorf, USW Policy Specialist

When it comes to analyzing the sustainability of agricultural crops there is a tendency to apply generalized metrics or standards to a wide swath of scenarios. While there is value in using generalized metrics, broad stroke approaches can miss the small details that often make a big difference in regional situations. Seeing the whole forest is important, but sometimes you learn more by focusing a little more on individual trees.

Let us discuss wheat, for example. This is a crop with many specific advantages often not considered in a sustainability analysis. Farmers tend to grow wheat on marginal land areas that do not receive enough water for other agricultural production or in areas too cold or too dry for other crops. In some regions and systems, it plays a vital role in rotations with other row crops by providing residue in a soybean rotation and a water-saving role in irrigated corn or sorghum. In assessing wheat’s sustainability, generalized base metrics of water usage do not take in the whole picture. Wheat’s true sustainability should also include what it adds to the entire agricultural system, and how it complements other crops while providing an essential food grain for literally billions of people.

One area of wheat production that has been criticized for its sustainability in the past is Desert Durum® in the desert southwest United States. Unlike most other wheat production, Desert Durum receives almost all of its water from irrigation. However, it uses less irrigation water than many of the other crops grown in that region, and farmers are constantly working to increase irrigation efficiency.

A recent study by Dr. George Frisvold of the University of Arizona analyzed sustainability metrics for water use in Arizona small grain production and found that most generalized metrics of sustainability do not adequately reflect the true nature of this system. Wheat, and specifically Desert Durum, plays an important role in sustainable agriculture in the Southwest. Using wheat in a rotation with vegetables in this area increases farmer profit significantly and maximizes economic productivity of water use. In addition, the study showed that the amount of water necessary to produce one bushel of Desert Durum in Arizona has declined by 18 percent over the last 30 years.

In the case in desert wheat and durum production, as in other U.S. wheat producing regions, different systems and environments face different challenges and producers adapt with different sustainable solutions. A general measure can never fully capture all of those nuanced solutions comprehensively.

For more information, visit http://bit.ly/1LROd1O, or http://www.thesustainabilityalliance.us/.


3. Global and Domestic Perspectives on How Best to Meet the Growing Demand for Food

“As a neutral forum, FAO has been promoting debates, dialogues and exchanges of information in order to enhance our knowledge of a broad portfolio of tools and approaches to eradicate hunger, fight every form of malnutrition and achieve sustainable agriculture.” That is how Jose Graziano da Silva, Director-General of the Food and Agriculture Organization of the United Nations, opened the recent FAO-hosted international symposium, “The Role of Agricultural Biotechnologies in Sustainable Food Systems and Nutrition.”

The symposium focused mainly on the broad range of biotechnologies that could result in yield increases, better nutritional qualities, and improved productivity of crops, livestock, fish and trees benefitting family farms. These include many applications such as fermentation processes, bio-fertilizers, artificial insemination, the production of vaccines, disease diagnostics, the development of bio-pesticides and the use of molecular markers in developing new plant varieties.

UN statistics indicate that one out of every nine people in the world is currently unable to eat enough nutrient energy to conduct an active and healthy life. In this context, Graziano da Silva said biotechnologies, knowledge and innovation must be available, accessible and applicable to family farmers and small holders.

Such issues are getting a wide hearing these days, including by the Philippine government Departments of Agriculture, Science and Technology, Environment and Natural Resources, Health, and Interior and Local Government. These agencies this week issued a joint ruling expected to lift a temporary ban on research, field-testing, commercialization and importation of genetically modified crops and biotech products in the country imposed by the country’s Supreme Court last December.

The scientific and academic community, farmer groups, traders, food and feed processors, and livestock producers had all criticized the ban. Dr. Emil Q. Javier, a noted Filipino scientist, academician and chair of the Coalition for Agriculture Modernization in the Philippines, said the temporary ban helped change public opinion about the science and benefits of genetically modified organisms by drawing attention to the issue and encouraging researchers to raise their voices about such advances in science and technology.

More specific to wheat, leaders from the National Association of Wheat Growers (NAWG) are raising concerns about the economic viability of wheat production in the United States, and promoting the potential role of all new technologies to help.

For example, NAWG is developing a National Wheat Action Plan and a yield contest. In addition, at the recent Commodity Classic event, NAWG’s past president Brett Blankenship said the industry also wants to focus on such improvements in seed technologies as biotechnology and other “new breeding techniques shy of GMO.”

The Washington farmer spoke in favor of advancements in wheat genetics. When asked if he would grow biotech wheat on his own property, Blankenship said that “would be a marketing decision more than an agronomic one.” He pointed to the high volume of Washington wheat exported to markets that are “sensitive” to biotechnology.

For more information about the joint positions of USW and NAWG on agricultural biotechnology, visit www.uswheat.org/biotechnology.


4. USDA-ARS Soft Wheat Quality Lab, Breeders Work to Improve Soft Red Winter Wheat Quality
By Steve Mercer, USW Vice President of Communications

Anyone who grows wheat or mills flour knows that growing conditions affect wheat quality from year to year. For example, the weather has not been overly friendly to the U.S. SRW wheat crop the past few seasons. Not every state where SRW grows had quality problems, but fusarium head blight pushing up DON levels and rain at harvest in the south and Midwest pushing down falling numbers had significant effects in 2014 and 2015.

Although researchers have not yet found a way to keep weather from affecting wheat soundness, they certainly can, and do, build the potential for excellent milling and processing quality into seed stock. Public and private wheat breeders are working every day to advance U.S. wheat quality. It is a mission deemed so important for domestic and overseas customers that the U.S. government continues to support it in part by funding four regional Wheat Quality Laboratories. The Soft Wheat Quality Laboratory (SWQL) in Wooster, OH, evaluates end-use quality of wheat breeding lines as well as existin­­g and new varieties to support the development of wheat varieties possessing superior quality, and conducts quality research on SRW grown in the eastern United States.

Dr. Byung-Kee Baik joined USDA’s Agricultural Research Service as SWQL Director in 2013. He said SWQL’s work provides public information to a wide variety of organizations.

“Our staff analyzed more than 6,000 soft red winter samples from 16 public and private breeding programs for end use quality in 2015,” he noted. “On each sample, we conduct wheat grade and non-grade tests, mill each sample on our quadrumat laboratory mill and then conduct flour, dough and baking tests. We share the results with breeders and domestic millers to help them select the varieties that perform best.”

“Soft red winter wheat has so many potential end use applications depending on the functional characteristics needed,” said Dr. Clay Sneller, Professor and Wheat Breeder with Ohio State University. “We can breed varieties with stronger gluten for baguette-type bread and weaker gluten lines for cake mixes and cookies. Now, our ability to identify markers for genes that control specific qualities in the wheat really helps us work with lines that have the quality traits end users need and the characteristics farmers need, including high yield potential and disease resistance. The quality analysis done here at the lab is the proof that we have found the right match.”

Overseas customers directly benefit from this work because SWQL conducts independent testing on SRW varieties for the U.S. Wheat Associates (USW) Overseas Varietal Analysis (OVA) program. The lab is one of several domestic partners that help collect, mill, inspect and test samples of new U.S. wheat varieties. USW then sends those samples to international millers and end use processors for analysis and comparison with local standards. USW compiles the results in annual reports shared with cooperators overseas and with wheat breeders in the United States. Ultimately, farmers plant the selected SRW varieties selected for good functional qualities — and supplies make their way into export channels.

USW believes that SRW exported from the Lakes, East Coast and Gulf ports and soft white (SW) from the Pacific Northwest are well placed to serve a growing demand around the world for higher-value end products. Through technical support and training, USW has already started helping premium flour millers and end-product manufacturers, especially in the emerging cookie (biscuit) and confectionary sectors, identify the economic benefits of using flour made from U.S. SRW and SW.

USW representatives look forward to sharing this support on a wider basis in the future. There is much confidence that the traits bred into U.S. wheat lines and proven by publicly funded research like that conducted at Ohio State University and the SWQL will help domestic and overseas flour and wheat food industries continue to prosper, and demand for U.S. soft wheats to grow.

Editor’s Note: For more information on another of the many publicly funded U.S. wheat research programs, click here to read an article on how breeders in South Dakota are emphasizing quality testing and selection in hard wheat classes.


5. New Wheat Foods Council Promotion Plan May Spark Ideas for Overseas Markets

The Wheat Foods Council (WFC) recently announced a new strategy to focus on new target audiences and messaging priorities after a strategic planning session at its recent annual meeting in Scottsdale, AZ.

“U.S. wheat overseas customers value high quality wheat and are eager to learn more, starting in breeding programs and all the way through to the nutritional value of the end product,” said USW Vice President of Communications, Steve Mercer. “Wheat Foods Council is an excellent resource and advocate for downstream customers and USW believes overseas wheat food organizations may find some useful ideas in their new approach.”

“I’m excited about our new plans,” said WFC President, Tim O’Connor. “We have identified a number of initiatives we will be able to implement immediately giving us a jump-start on our new strategies for next fiscal year’s programming which begins in July 2016.”

WFC developed the new strategic plan through extensive dialogue with the wheat industry including producers, millers and bakers along with insight obtained through a survey of medical doctors, registered dietitians and personal trainers.

“We identified personal trainers as a category of particular interest for targeting new educational programs due to their strong relationship with consumers as a go-to source for health and nutrition information,” said O’Connor. He added that registered dietitians, with whom the WFC has developed a strong relationship over several decades, will continue to be an important part of its influencer education mix.

In terms of messaging — while recognizing and supporting the importance of whole grains in the diet — the strategic plan places greater emphasis on educating influencers and consumers about the significant health contributions of enriched wheat products. Demystifying the milling process will go hand-in-hand with recognizing the role enriched wheat products play in healthful eating.

O’Connor said WFC will work with an Advisory Board to take a closer look at the science around ‘enriched’ grains, and will use this information as the basis for future programs. “We know the industry has supported enriched products,” he said. “Our new strategy builds on those initiatives and takes new approaches to advance the image of enriched wheat products.”

Another key area identified in the strategic plan is to develop education and messaging to influencer groups that focus on wheat and wheat breeding. The WFC will develop new program elements that proactively address misinformation in the media and on the Web surrounding this topic.

For more information, visit the WFC website, www.wheatfoods.org.

6. Wheat Industry News
  • Recognizing Years of Service. Many USW employees have recently celebrated milestone work anniversaries. We are so fortunate to have such devoted, loyal colleagues and we thank them for their years of dedicated service to our organization, to U.S. wheat farmers and to our customers around the world.
Hoda Moawad, Regional Program Supervisor, USW Cairo Office, celebrated 35 years in December 2015.
Sonia Munoz, Regional Program Manager, USW Santiago Office, celebrated 35 years in February 2016.
Plutarco Ng, Technical Consultant, USW Manila Office, celebrated 25 years in January 2016.
Mohamed Srhiyer, Clerk and Driver, USW Cairo Office, celebrated 20 years in November 2015
Elsa Chung, Executive Secretary and Bookkeeper, USW Hong Kong Office, celebrated 20 years in November 2015.
Kaiwen Wu, Office Manager and Bookkeeper, USW Beijing Office, celebrated 20 years in February 2016.
Alain Sellier, Program Manager, USW Headquarters Office, celebrated 20 years in February 2016
  • March 15 is National Ag Day. Every year, producers, agricultural associations, businesses, universities, government agencies and countless others join to recognize the contributions of agriculture. For more information and to learn how you can participate, visit www.agday.org. Follow USW online on Facebook and Twitter for live coverage all week.
  • Past USW Chairman in “Hall of Fame. The Eastern Idaho Agricultural Hall of Fame recently inducted Jerry Kress, a wheat farmer from American Falls, ID, and a Past USW Chairman (1998-99), for his contributions to Idaho agriculture and the U.S. wheat industry. Kress farms with his son, Jon, and also grow oilseeds and alfalfa hay. Kress served on the Idaho Wheat Commission and USW boards of directors for a decade. Read more here.
  • New NAWG Officer Team Installed at Commodity Classic. Gordon Stoner, a wheat grower from Montana, was elected to serve as the new President of the National Association of Wheat Growers (NAWG) at the association’s board of directors meeting at the recent Commodity Classic event. New to the officer team is Ben Scholz, a wheat grower from Texas, who will rotate through the officer board starting as secretary. To read the full announcement visit www.wheatworld.org.
  • NAWG Awards Ambassador Vetter with President’s Award. At the 2016 Commodity Classic, Immediate Past NAWG President Brett Blankenship awarded Darci Vetter, the Chief Agriculture Negotiator at the Office of the U.S. Trade Representative, with NAWG’s President’s Award. In its inaugural year, the award is designed to highlight individuals who work tirelessly on behalf of the agriculture industry. It is given to someone who expresses a passion for the wheat industry, based on the individual’s demonstration of commitment to the welfare and goals of America’s wheat farmers.
  • Condolences. USW was saddened to learn of the sudden death of long-time USW Cookie/Cracker Consultant, Terry Knabe. His knowledge and expertise will be sorely missed. Our thoughts are with his family.
  • IGP Institute Seeks Milling Expert. Creating a preference for U.S. and Kansas wheat is one of the goals of the educational programs at the Kansas State University IGP Institute. To help fulfill that objective, the Department of Grain Science and Industry and the IGP Institute are working together to identify high quality candidates for this 12-month, non-tenured faculty appointment. To learn more about the position visit the IGP Institute website at www.grains.ksu.edu/igp.
  • Wheat Marketing Center Asian Noodle Technology and Ingredient Application Course. This hands-on course, scheduled for April 5 to 8, 2016, will focus on better understanding noodle formulation, processing technology, evaluation techniques and the functionality of food ingredients in Asian noodle applications. For more information and to register visit http://wmcinc.org.
  • Northern Crops Institute Pasta Production and Technology Course. This course, scheduled for April 12 to 14, 2016, introduces the fundamental and applied aspects of manufacturing extruded pasta products. Raw material quality criteria, specifications and processing variables and their impact on final pasta quality will be present in detail. The registration deadline is March 28. For more information and to register visit www.northern-crops.com/training-courses.
  • IGP Institute Marketing Two Upcoming Milling Courses. The first course, Managing Mill Balance and Control, scheduled for June 7 to 10, 2016, will focus on the front half of the milling process with opti­mizing breaks and purifiers. The second course, Milling Practices to Improve Flour Quality, scheduled for June 14 to 17, 2016, will focus on the reduc­tion system of the milling process and how flour quality is managed. Course instructor Shawn Thiele encourages participants to stay for both courses as each covers important components in the milling process. For more information and to register visit www.igpevents.grains.ksu.edu.
  • Subscribe to USW Reports. USW has added a “Subscribe” menu at www.uswheat.org where visitors may subscribe to this newsletter, the weekly Price Report and the weekly Harvest Report (available May to October.) Click here to subscribe.


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