With new mills and an increasingly competitive price environment, the Philippines continues to be one of U.S. wheat’s top, consistent customers. As new industry leaders emerge there, USW recognizes the importance of providing training to increase millers’ knowledge of procurement strategies and the U.S. wheat marketing system through trade servicing in the South Asian nation and sometimes here at home.

In September, USW combined a formal training course with a first-hand view of the U.S. wheat supply chain for a delegation of six executives from the Philippine milling industry to the United States, Sep. 20 to 22, 2017. USW collaborated with the Northern Crops Institute (NCI), the Washington Grain Commission (WGC) and the Oregon Wheat Commission (OWC) to organize and host this group. Funding also came from the USDA Foreign Agricultural Service (FAS).

“The Philippines was the third largest buyer of U.S. wheat in the 2016/17 marketing year with total imports reaching almost 103 million bushels (2.8 million metric tons) and the largest buyer of both soft white (SW) and hard red spring (HRS) wheat,” said USW Assistant Regional Vice President Joe Sowers, who led the team. “This delegation represented mills that imported more than 1.5 MMT of U.S. wheat in the past marketing year with an estimated FOB value of $325 million.”

The executives first participated in the Grain Procurement Management for Importers short course at the NCI in Fargo, N.D., from Sept. 11 to 20. The course focused on basic hedging principles, fundamental and technical analysis of commodity markets, basis and spreads, the U.S. grain transportation infrastructure, U.S. wheat grading standards and purchase quality specifications for wheat importers.

USW Vice President and West Coast Office Director Steve Wirsching joined the delegation at NCI to deliver a presentation entitled “Getting the Wheat Quality and Value You Want.” The group learned about the importance of wheat quality specifications in purchase contracts and the role of the Federal Grain Inspection Service (FGIS) in performing all mandatory grain inspections for quality assurance.

Sowers shared that a trading game exercise in the commodity trading room at the North Dakota State University Department of Agribusiness and Applied Economics was particularly helpful to both senior and junior members of the delegation in better understanding the intricacies of wheat purchasing.

After attending the course, the delegation traveled to Washington where they visited the WGC to discuss supply and demand and toured HighLine Grain, LLC.

“The Philippines is Washington farmers’ leading customer for soft white wheat, so this was an important opportunity to share our appreciation for their business,” said WGC Vice President Mary Palmer Sullivan. “Having just completed the grain procurement course, they were able to connect what they learned in the course with the real experience and people here in our state.”

Next, the delegation drove from Spokane, Wash., to Portland, Ore., making stops along the way to visit USW Chairman Mike Miller near Ritzville, Wash., and in Pasco, Wash., to visit Tri-Cities Grain, LLC, and meet with WGC commissioners Damon Filan and Dana Herron.

Palmer Sullivan, who traveled with the delegation from Washington to Oregon, shared that the team was particularly interested in learning more about the transportation system.

“Last year, the scheduled river closures and the weather heavily impacted transportation issues for our overseas customers,” said Palmer Sullivan. “I think seeing and learning about the system helped them better understand how to plan ahead and that U.S. wheat farmers are dedicated to providing them with a reliable wheat supply.”

In Portland, the delegation visited the USW West Coast Office and Wheat Marketing Center (WMC) and met with a FGIS quality assurance specialist. On a tour of the TEMCO (Cargill/CHS) export elevator, the group witnessed first-hand FGIS’s supervisory role in vessel hold inspection and loading to contract specifications to ensure uniform quality. During a meeting with the Pacific Grain Export Association, whose members compete for their business, the delegation received timely market information specific to each wheat class. The group also met with OWC CEO Blake Rowe and Commissioner Darren Padget.

“The Philippines was also our largest soft white wheat market this past year, so we wanted to explain the emphasis we put on quality throughout our production process,” said Rowe. “Everyone, from our wheat breeders to our growers to our handlers to our exporters, has a role in providing quality wheat to our customers.”

“This trip gave us the opportunity to keep sharing the many ways the U.S. grain production and marketing system benefits the Filipino industry, which has a strong preference for U.S. wheat that we want to reinforce,” said Sowers.

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.

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Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S.- 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

Taiwan Flour Millers Association (TFMA) Chairman Tony I. T. Chen (center right) and U.S. Wheat Associates (USW) President Vince Peterson (center left) signed a letter of intent by TFMA to purchase a total of 1.8 million metric tons of U.S. wheat in 2018 and 2019 on Sept. 13, 2017, in the Mansfield Room of the U.S. Capitol in Washington, D.C. The ceremony is a part of a biennial Agricultural Trade Goodwill Mission to the United States to purchase grains and other agricultural products for the people of Taiwan. Witnesses to the signing include Congressman Roger Marshall of Kansas (left of Vince Peterson), Representative Stanley Kao, Taipei Economic and Cultural Representative Office in the United States and a Republic of China agricultural minister.

“We all look forward to this event and appreciate the long history of mutually beneficial trade relations with the Taiwan milling and wheat foods industries,” said Peterson.

USW, the U.S. Grains Council, the U.S. Soybean Export Council and the North American Export Grain Association honored delegates from TFMA and Taiwan’s feed and oilseed industries at a reception Sept. 12, 2017, in Washington, D.C. The delegates also signed letters of intent to import U.S. corn and soybeans.

Taiwan is on average the sixth largest market for U.S. wheat. TFMA imports wheat on behalf of all 20 Taiwanese flour mills and has imported far more wheat from the United States compared to other origins, at an average of 1.03 million metric tons (37.9 million bushels) per year since marketing year 2011/12 (June to May).

Significant hard red spring (HRS) imports reflect a need for strong gluten flour for breads, rolls and frozen dough products as well as for blending with hard red winter to make traditional Chinese flour foods and noodles. Year-to-date sales of HRS to Taiwan in marketing year 2017/18 are up 93 percent from 2016/17. Soft white (SW) wheat imports, including Western White wheat (a blend of SW and up to 20 percent club), help meet growing demand for cake, cookie and pastry flours.

Chairman Chen and other TFMA delegates will also visit North Dakota, Montana and Idaho to make similar commitments and to meet with state wheat commission representatives and state government officials.

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About U.S. Wheat Associates
USW’s mission is to “develop, maintain, and expand international markets to enhance the profitability of U.S. wheat producers and their customers.” Its activities are made possible by producer checkoff dollars managed by 18 state wheat commissions and through USDA Foreign Agricultural Service cost-share funding. For more information, visit www.uswheat.org or contact your state wheat commission.

Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S.- 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.

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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Nondiscrimination and Alternate Means of Communications
U.S. Wheat Associates prohibits discrimination in all its programs and activities on the basis of race, color, religion, national origin, gender, marital or family status, age, disability, political beliefs or sexual orientation. Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact U.S. Wheat Associates at 202-463-0999 (TDD/TTY – 800-877-8339, or from outside the U.S.- 605-331-4923). To file a complaint of discrimination, write to Vice President of Finance, U.S. Wheat Associates, 3103 10th Street, North, Arlington, VA 22201, or call 202-463-0999. U.S. Wheat Associates is an equal opportunity provider and employer.