Growth in South Asia Leads Customers to Learn More About the U.S. Wheat Industry
In South Asia, the market for wheat-based foods is rapidly growing, and people are starting to take notice. The largest company serving those markets is Singapore-based Wilmar International. Its holdings include flour milling operations in Vietnam, Indonesia and Malaysia that process about 2 million metric tons (MMT), or about 73.5 million bushels, of wheat. As the company expands its milling operations, most of the wheat it needs must be imported, and USW is working with Wilmar wheat buyers and flour millers to promote the value U.S. wheat can add to their expansion.
USW welcomed a trade team of four executives from Wilmar’s Singapore, Vietnam and Indonesia operations to the United States, Aug. 9 to 16, 2017. USW collaborated with the Montana Wheat & Barley Committee (MWBC), Washington Grain Commission (WGC), Idaho Wheat Commission (IWC) and the Oregon Wheat Commission (OWC) to organize and host this trade team. Funding also came from the USDA Foreign Agricultural Service (FAS).
“These executives understand the business side, but selecting the right wheat is important to see those business plans through,” said Matt Weimar, USW Regional Vice President in South Asia. “We want to help them develop a deeper understanding of how to use data on crop quality, supply and demand, contract specifications and U.S. federal grain inspections to minimize price risk and meet or exceed the company’s milling and end-use standards.”
The team began its trip in Montana and Idaho, where they were welcomed by local growers and participated in hard red spring (HRS) and soft white (SW) wheat harvest. This is included a visit with USW Vice Chairman Chris Kolstad, who produces HRS and hard red winter (HRW) wheat and other crops. They also toured Montana State University’s variety development programs, the Lewis and Clark Grain Terminal and the Pacific Northwest Farmers Cooperative.
“The team saw firsthand that U.S. wheat producers have a direct investment in their crops. With funding from grower organizations combined with other public and private funds, they are able to develop new varieties and fund on-going research to increase yield and end-use performance in those varieties,” said Blaine Jacobsen, IWC Executive Director.
The team shared that they gained a new appreciation for the large investment individual producers and the rest of the industry puts into getting a reliable supply of wheat with consistent quality to traders, millers and food processors in Asia.
The team continued their tour of the supply chain in Washington state, where they visited the USDA ARS Western Wheat Quality Laboratory and Highline Grain Rail Loading Facility, which receives regional rail shuttles of grain, and ships 15 hopper car shuttle trains to export facilities on the Columbia River and Puget Sound. The timing of their visit also allowed the team to meet with the WGC to discuss supply and demand, as well as Washington State University wheat researchers to learn about new variety development. They learned that the information from these programs is shared with wheat farmers at through meetings conducted every year on new high quality and good yielding varieties.
Mary Palmer Sullivan, WGC Vice President, explained that while all the participants represented the same company and shared priorities, their separate business units have different end-products.
“Consistency is essential to their brand, especially as demand grows, and they are working directly with their consumers to maintain that consistency,” said Palmer Sullivan. “These meetings allowed us to do the same for them and demonstrate the quality of U.S. wheat.”
“We need to educate the end-users because now everything is based on price. We need to help them see that if they buy quality, they will get quality,” said Hairuddin Halim, General Manager, Wilmar Indonesia.
In Oregon, visits included the OWC, Wheat Marketing Center, Federal Grain Inspection Service and the Pacific Grain Exporters Association. They also visited the Columbia Export Terminal and met with U.S.-based grain traders, which allowed them in turn to inform the traders about Wilmar’s wheat quality needs in their many markets.
“The U.S. system of public universities, grower organizations and USW maintains a stream of research and development, quality assurance and control, yield growth and communications with domestic mills, retailers, consumers and international U.S. customers,” said Weimar. “This chain of support, both through trade and technical servicing, does not exist in other markets that originate wheat, so it is essential to witness it in action.”
“When we buy U.S. wheat, we assume that the quality we are asking for is what we are going to get,” said Tze Shien Ang,” Senior Executive, Oilseeds and Grains, Wilmar Trading, Singapore. “Now, because of this trip, I can see why.”
USW’s mission is to “develop, maintain, and expand international markets to enhance wheat’s profitability for U.S. wheat producers and its value for their customers.” USW activities in more than 100 countries are made possible through producer checkoff dollars managed by 17 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. For more information, visit our website at www.uswheat.org.
View pictures of the trade team’s visit on Facebook here.
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