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U.S. Wheat Associates Sees Positive Outcome at WTO Ministerial Conference

To misquote Mark Twain, reports of the death of agricultural negotiations at the World Trade Organization (WTO) are exaggerated. That is a key message for the world’s wheat growers and buyers following the Thirteenth WTO Ministerial Conference (MC13) in Abu Dhabi, United Arab Emirates. In the WTO photo above, Director General Okonjo-Iweala encouraged members to close remaining gaps to secure outcomes during the Conference.

“Going into MC13 negotiations, we did not want to see any backsliding on past progress made on agricultural commitments at the WTO,” said U.S. Wheat Associates (USW) Director of Trade Policy Peter Laudeman, who joined a coalition of U.S. agricultural representatives at the Conference. “Fortunately, the U.S. negotiating team and many other countries were able to hold firm, particularly against India’s protection of its trade-distorting wheat and rice policies.”

On Feb. 29, 2024, during the Ministerial, Politico Pro trade reporter Doug Palmer provided additional background about the agricultural negotiations.

“The U.S. farm groups contend India’s me-first approach is a non-starter because the “peace clause” agreed in Bali has allowed it to accumulate huge rice and wheat stocks that it buys at above market prices and then sells into world markets at a discount,” Palmer wrote. “They also argue there is a much older mandate for a broad-based negotiation in the 1994 WTO Agriculture Agreement that includes trade-distorting domestic support and market access barriers that countries impose to keep out farm exports.”

For more information about U.S. wheat industry positions on WTO agricultural policy, visit “USW Trade Policy Team Addresses India’s Subsidies, Turkish Flour at WTO.”

Members of a U.S. agricultural coalition met during the WTO MC13 with USTR Chief Ag Negotiator Doug McKalip in February 2024.

USTR Chief Agricultural Negotiator Doug McKalip met with U.S. agricultural industry representatives at the WTO 13th Ministerial Conference in Abu Dhabi in February 2024. Representatives included (L-R) Peter Laudeman, U.S. Wheat Associates: Molly O’Connor, CropLife America; Ambassador McKalip; Maria Zieba, National Pork Producers Council; Karah Fissel, USA Rice; Sharon Bomer Lauritsen, AgTrade Strategies, LLC; Tony Rice, National Milk Producers Federation; and Ben Conner, DTB AgriTrade.

Shared Interests

Laudeman would agree with U.S. Trade Representative (USTR) Ambassador Katherine Tai‘s post-conference statement that, “Members have worked to identify shared interests and build convergence in a collaborative way. Members are identifying new ideas and improvements that can help all of us more effectively resolve disputes and make the system more accessible at the same time.”

The U.S. government negotiating team including USTR Chief Agricultural Negotiator Doug McKalip deserves credit for holding the line on the issues in agriculture said Laudeman who also noted that support existing commitments is more widespread than in the past.

Opportunity to Advance Negotiations

“Many countries that agreed that India’s firm stance on Public Stockholding (PHS) was not productive in advancing agricultural negotiations at the WTO,” Laudeman said. “Notably, many Least Developed Countries recognized that India’s PSH program had negatively affected their own food security.”

Ambassador Tai went on to say that while the United States is disappointed that WTO members were not able to reach consensus on agriculture, “the United States will continue to engage with other Members to achieve meaningful outcomes on these important issues.”

“The message for our wheat farmers and our customers around the world is that the WTO is not broken yet,” Laudeman said. “And we are still standing up for commitments that have been made and creatively looking for progress in the way forward.”

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Importance of Trade, Relationship-Building Discussed as Leaders Gather in Washington

U.S. Trade Representative Katherine Tai speaks at USDA's 2024 Ag Outlook Forum.

U.S. Trade Representative Katherine Tai spoke about free trade agreements at USDA’s 2024 Ag Outlook Forum, held Feb. 15-16 in Washington, D.C.

Agricultural trade – including topics tied closely to the work of U.S. Wheat Associates (USW) – was a major focus during the 100th annual Ag Outlook Forum hosted Feb. 15-16 by USDA in Washington, D.C.

A panel discussion titled, “100 Years of U.S. Ag Trade; A Century of Growth, Innovation, and Progress” was the highlight of the first day. The panel featured speakers from USDA, the United Nations (UN) Food and Agriculture Organization (FAO), and the Peterson Institute for International Economics.

History of Free Trade

USDA Senior Economist Sharon Sydow presented a crash course on the history of trade liberalization. Her subjects ranged from the General Agreements on Tariffs and Trade (GATT) to the creation of the World Trade Organization (WTO) and expansion of bilateral and multilateral trade agreements.

“The historical perspective of her presentation showed the exponential growth in U.S. agriculture trade through these progressive measures,” said forum attendee USW Director of Trade Policy Peter Laudeman.

Global Food Assistance

Also on the first day, Food and Agriculture Organization of the United Nations (FAO) Deputy Director General Beth Bechdol pointed out that agricultural trade is critical to the nourishment and development of poor, food insecure countries. Looking to the future, Bechdol said she sees successful American agricultural trade as an essential component for fighting global hunger and poverty.

Importance of Trade

On the second day, several speakers highlighted the importance of agricultural trade. A keynote address by U.S. Trade Representative Katherine Tai addressed some of the recent free trade accomplishments that have eliminated barriers to agricultural trade. Additionally, she committed to continue fighting for American farmers in places where trade barriers remain.

Carlson Addresses the Philippines, Relationships

MaryKay Carlson, U.S Ambassador to the Philippines, was also in attendance and spoke on the importance of relationships for agricultural trade success. She highlighted the long-standing ties between the U.S. and the Philippines.  Those ties have allowed that country to become the No. 2 export destination for U.S. wheat. Carlson noted the consistent quality of U.S. wheat and characteristics that make Filipino flour millers and bakers regular customers.

Relationship-building has also been a big part of the success the U.S. has enjoyed in the Philippines. USW recently helped the Filipino flour milling industry achieve renewed anti-dumping duties on imported Turkish flour to defend and maintain this trading relationship with U.S. wheat farmers.

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USW Joins Panel Discussion on Role of Commodities in International Food Assistance

U.S. Wheat Associates (USW) participated in a Feb. 6 briefing panel for Capitol Hill staff that was focused on international food assistance programs and hosted by U.S. Representatives Tracey Mann (KS), Rick Crawford (AR), John Garamendi (CA) and Jimmy Panetta (CA).

USW Director of Trade Policy Peter Laudeman was a panel member along with representatives of rice and milling industry and the Seafarer’s Union (AFL-CIO). Rep. Mann moderated the discussion, while Rep. Crawford was on hand to remark on issues involving food programs.

The panel that discussed food assistance programs for Hill staffers on Feb. 7 were, left to right: Bobby Hanks, representing USA Rive; USW Director of Trade Policy Peter Laudeman; Adam Thomas, representing the North American MIllers' Association; and Brian Schoenman, Political and Legislative Director of Seafarers International Union of North America.

The panel that discussed food assistance programs for Capitol Hill staffers on Feb. 7 were (left to right): Bobby Hanks, representing USA Rive; USW Director of Trade Policy Peter Laudeman; Adam Thomas, representing the North American Millers’ Association; and Brian Schoenman, Political and Legislative Director of Seafarers International Union of North America.

A Team Effort

Joining Laudeman on the panel were Bobby Hanks, representing USA Rice; Adam Thomas, representing the North American Millers’ Association; and Brian Schoenman, Political and Legislative Director of Seafarers International Union of North America.

“The briefing covered a broad landscape but was particularly focused on the American Farmers Feed the World Act, which remains a strong opportunity to reinforce the role of U.S. commodities – most notably wheat – in international food assistance,” Laudeman said, noting that the legislation carries impact for both U.S. wheat producers and the entire wheat industry.

Part of Farm Bill Effort

The American Farmers Feed the World Act of 2023 would restore the emphasis on U.S.-grown commodities to fight global hunger, rather than using American taxpayers’ dollars to purchase food from America’s competitors. It would also restore transparency by reducing overhead costs, preserving resources to purchase life-saving food, and protecting at least 50% of the budget for purchasing U.S.-grown commodities and delivering them to the destination country.

“As both the House and Senate move closer to final Farm Bill text in each chamber, solidifying all additional support for the American Farmers Feed the World Act will be critical,” Laudeman added.

Wheat Plays Major Role

USW has joined the National Association of Wheat Growers (NAWG) and other agriculture commodity groups in backing the legislation since it was introduced in June 2023.

“America’s international food aid programs have enjoyed bipartisan support for more than 65 years because they are simple, effective, and they feed millions of vulnerable people around the world each year,” Mann said when introducing the Act in June 2023. “Through these programs, America fortifies our allies, counters the influence of foreign adversaries, creates new markets and trading partners, and stops wars before they start. For decades, America has purchased and donated American-grown commodities to execute our foreign assistance programs.”

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Washington Grain Commission CEO Testifies on Behalf of Columbia Snake River System

On Jan. 30, 2024, Casey Chumrau, CEO of the Washington Grain Commission, offered compelling testimony supporting the crucial infrastructure of dams and locks on the Columbia Snake River System (CSRS) at a U.S. House Energy, Climate, and Grid Security Subcommittee hearing. U.S. Wheat Associates (USW) and the National Association of Wheat Growers (NAWG) sent separate letters with their observations of the essential nature of the CSRS for U.S. wheat export competitiveness.

Following are excerpts from Chumrau’s testimony.

Grain growers in the Pacific Northwest (PNW) rely on the Columbia Snake River System, and the Lower Snake River Dams (LSRD) in particular, for their livelihoods. More than 55 percent of all U.S. wheat exports move through the PNW by barge or rail. Specifically, 10 percent of wheat that is exported from the United States passes through the four locks and dams along the Lower Snake River. This is especially important for our state because Washington is the fourth largest wheat exporter in the nation, exporting 90% of the wheat produced in the state. Across the agriculture industry, the Columbia Snake River System is the second largest gateway for soybean and corn exports coming from as far as the Midwest. The river system also serves as an important channel to bring crop inputs, like potash, to farmers in the region who need fertilizer to produce the safe and affordable food supply that is found on every American’s table.

Casey Chumrau, CEO, Washington Grain Commission, giving testimony on Columbia Snake River System Jan. 30, 2024, to a U.S. House subcommittee hearing.

Casey Chumrau, CEO, Washington Grain Commission, giving testimony on Columbia Snake River System Jan. 30, 2024, to a U.S. House Energy, Climate, and Grid Security Subcommittee hearing.

Economic Impact

Washington’s agriculture industry, and its ability to produce and export products globally, are critical to the state and region’s economy. The total value of wheat exported through the PNW is nearly $4 billion per year.

For Washington, the state is among the top 20 states for agricultural exports in the nation, with over $8 billion in Washington-grown or processed food and agriculture exports in 2022. A significant volume of food and agriculture products from other states including soybeans, wheat, and corn are exported through Washington state ports each year. Once these pass-through exports are combined with Washington-grown or processed exports, the total value reaches over $23 billion.

The Washington wheat industry alone contributed over $3.1 billion to the state’s economy in 2022, with a heightened impact in rural areas. In the same year, total direct employment associated with Washington wheat production amounted to 3,672 jobs in 2022. Indirect and induced employment also grew and supported another 11,676 jobs.

The impact that Washington farmers have on their local and regional economy is similar in communities across the country. In addition to direct sales of farm goods and commodities, farmers contribute to the economy and support other rural businesses through purchases of farm business inputs – everything from seed and fertilizer to business services. Additionally, the personal purchases of both farmers and their employees help to stimulate local economies and keep small businesses ruining.

Locks and dams on the Lower Snake River and the Columbia River provide essential infrastructure for moving U.S.-grown wheat to high-value markets around the world. We cannot overstate the positive value they create for U.S. farms, [the] economy of the Pacific Northwest and far beyond. – From USW letter to House subcommittee hearing on the Columbia Snake River System

Supply Chain and Transportation

Over the last seventy years, growers and their federal government partners at the U.S. Department of Agriculture have invested billions of dollars and countless hours to build strong relationships with our trading partners. The U.S. wheat industry differentiates itself by providing high-quality wheat and reliable delivery. The United States is a reliable trading partner in large part because of our world class, multi-modal infrastructure, which allow us to safely and efficiently ship products around the world. Any disruption to that system would hurt our ability to consistently provide abundant, high-value food products and remain competitive with other agricultural exporters in the world and weaken the competitiveness of U.S. producers in global markets.

Grain growers in PNW states are at the tip of the spear of those who would feel the disruption of having to divert export goods to trucking and rail because there is insufficient alternative transportation infrastructure to replace the barge shipments of grain along the Columbia Snake River System to export markets. For example, one loaded covered hopper barge carries over 58,000 bushels of wheat. It would take 113,187 semi-trailers each year carrying 910 bushels of wheat to replace the 103 million bushels shipped on the Snake River via barge annually. That is 310 more trucks each day, making round trips to the Tri-Cities, 365 days per year. To that end, barging is the most fuel-efficient mode of transportation when compared to railroads and trucking. Each barge that must be replaced by a truck means more pollution, more traffic, increased costs and increased wear and tear on our roads – and that’s if we could even hire the drivers needed to drive these trucks in the increasingly tight labor market for drivers.

Path Forward

We strongly believe that dams and salmon can and do co-exist. With a myriad of challenges facing the salmon population, we are committed to building upon current investments and technological advancements. Currently, the Lower Snake River Dams have world-class fish passage and juvenile survival rates upwards of 95 percent. We believe any work moving forward should build off the fish passages, instead of eliminating them. We also support investments made at the federal and state level for culvert removal, fish habitat restoration, toxin reduction, and predator abatement.

Conclusion

The opportunities to ensure salmon populations continue to grow do not have to come at the cost of destroying the integrity of the Columbia Snake River System and the livelihood of farmers. The importance of the river system for the agriculture industry, and particularly for grain growers across Washington, cannot be overstated. I look forward to discussing the importance of the four Lower Snake River Dams with you today. Thank you.

To read more about this issue, see these previous “Wheat Letter” posts:

“Exports Depend on Snake River Dams“

“USW Expresses Support for Maintaining Lower Snake River Dams“

“Wheat Leaders: Protect Lower Snake River Dams“

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Senate Ag Committee Leadership Urges More Support for Trade Promotion and Food Assistance

U.S. Senators Debbie Stabenow (D-Mich), Chairwoman of the U.S. Senate Committee on Agriculture, Nutrition, and Forestry, and John Boozman (R-Ark), Ranking Member, have urged USDA to use its authorities under the Commodity Credit Corporation (CCC) Charter Act to support opportunities for U.S. farmers.

In a letter to the USDA Secretary Tom Vilsack, Stabenow and Boozman highlighted the need to invest in trade promotion and in-kind international food assistance, both of which support American farmers and producers.

Good for U.S. Farmers

“As Congress works toward reauthorizing critical programs in the Farm Bill, we continue to hear from organizations representing the vast majority of U.S. agriculture about the need to strengthen trade opportunities, increase revenue streams, and help producers grow and thrive in a global economy,” the Senators wrote. “We believe that resources available under the CCC can support similar efforts to open access to markets and promote American-grown products abroad.”

“The letter is intended to convey the strong, bipartisan support for additional market promotion funding but also reflects the challenge of identifying new funding resources for a broader Farm Bill reauthorization,” said Tyson Redpath with The Russell Group, a bipartisan government relations firm that represents the Coalition to Promote U.S. Agricultural Trade, in which U.S. Wheat Associates (USW) is a member.

“There is also bipartisan support for critical U.S. Department of Agriculture international food assistance programs,” the Senators continued. “We urge you to explore using CCC resources to advance food assistance initiatives, which will both address humanitarian needs abroad and support American farmers.”

Chinese wheat foods seminar

USW’s work providing technical support to overseas wheat buyers and end product processors like this healthy Chinese wheat food baking seminar in Taiwan is funded by export market development programs administered by USDA-Foreign Agricultural Service. Congress approves program funding through federal “Farm Bill” legislation.

Good for Importers of U.S. Wheat

“We were quite pleased to see the leaders release their letter to Secretary Vilsack,” said USW President Vince Peterson. “Our friends at the National Association of Wheat Growers are strong advocates in Congress for increased export market development program funding. And the use of CCC funds to enhance both export marketing activities and food aid programs would be to the great benefit of U.S. agriculture and the overseas wheat buyers with whom we work.”

This request from the Chairwoman and Ranking Member comes as the Committee continues working to develop a Farm Bill this year. The full text of the letter can be found here.

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A Legacy of Commitment – The USDA and U.S. Wheat Export Public-Private Partnership Today

In this article, originally published during U.S. Wheat Associates’ 40th anniversary in 2020, Wheat Letter describes the highly successful public-private partnership supporting U.S. wheat export market development that has endured since the 1950s.

“The proper role of government…is that of partner with the farmer – never his master. By every possible means we must develop and promote that partnership – to the end that agriculture may continue to be a sound, enduring foundation for our economy and that farm living may be a profitable and satisfying experience.” – President Dwight D. Eisenhower, from a message to Congress on agriculture, Jan. 9, 1956.

In 2020, Wheat Letter offered historical perspective on how changes in federal programs, global market factors and relationships drew Western Wheat Associates and Great Plains Wheat Market Development Association ever closer together and led to the establishment of U.S. Wheat Associates (USW) as a single export market development organization to serve all U.S. wheat farmers.

A formal agreement between the Nebraska Wheat Commission and USDA’s Foreign Agricultural Service (FAS) to co-fund and implement export market development activities in 1958 marked the beginning of an enduring partnership between farmers, state wheat commissions, FAS and USW after the merger in 1980.

“I consider this to be one of the most successful partnerships between a U.S. government agency and private industry,” said USW President Vince Peterson. “Each partner brings unique core capabilities that support the export development mission. Our activities are jointly planned, funded and evaluated. We all share the risks, responsibilities and results.”

It Starts with the Farmer

State wheat commissions exist under state law generally to conduct promotion and market development through research, education and information. Commissions are funded by assessments paid by the farmer either by bushel or by a portion of the price at the time of sale. This is called a “checkoff” and though it is voluntary, a strong majority of farmers contribute their assessment. Farmer commissioners, either elected by their peers or appointed by their state’s governor, direct how the checkoff funds are to be used, such as for domestic promotion, public crop production research and variety development and export market development.

In 2017, Ralph Bean, who was then Agricultural Counselor, USDA Foreign Agricultural Service, U.S. Embassy Manila (far right), met with farmers from South Dakota, North Dakota and Montana during their USW Board Team visit to South Asia . The farmers were guests of honor at the 9th International Exhibition on Bakery, Confectionary and Foodservice Equipment and Supplies, known as “Bakery Fair 2017,” hosted by the Filipino-Chinese Bakery Association Inc.

By agreeing to contribute a portion of checkoff funds to USW for export market development, state wheat commissions choose to become members of USW. The annual USW membership assessment is about $0.004 per bushel, multiplied by the average production in the state over the past five years. Currently 17 state wheat commissions are USW members.

The contributions from state wheat commissions, including special project funds as well as the personal time and talent invested by farmers and U.S. wheat supply chain participants, supports the 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. In addition, state commission contributions qualify USW to apply for federal export market development funds administered by FAS.

Linking U.S. Agriculture to the World

USDA’s Foreign Agricultural Service has primary responsibility for overseas programs including market development, international trade agreements and negotiations, and the collection of statistics and market information. It also administers the USDA’s export credit guarantee and food aid programs and helps increase income and food availability in developing nations by mobilizing expertise for agriculturally led economic growth. The FAS mission is to link U.S. agriculture to the world to enhance export opportunities and global food security.

Jim Higgiston (left), who was then USDA/FAS Minister Counselor for Agricultural Affairs, met with Regional Director Chad Weigand (right) and farmer members of a USW Board Team in September 2018 in the capital city of Pretoria, South Africa. The FAS team in Pretoria included Kyle Bonsu, Agricultural Attache, Laura Geller, Senior Agricultural Attache, and Dirk Esterhuizen, Senior Agricultural Specialist.

FAS export market development programs available to USW as a cooperating organization include the Market Access Program (MAP), the Foreign Market Development (FMD) program, the Agricultural Trade Promotion program and the Quality Samples Program. USW is required to conduct an extensive, annual strategic planning process that carefully examines every market, identifying opportunities for export growth and recognizing trends or policies that could threaten existing or prospective markets. FAS reviews this annual plan, the Unified Export Strategy (UES), results from previous years and private commitments to determine how USW will invest program funds. In 2022/23, federal funding provided $2.20 for every $1.00 contributed by farmers through their state wheat commissions.

“It is important that [overseas] buyers and government officials develop direct personal relationships not only with us at USDA but also directly with American farmers and ranchers,” said former USDA Under Secretary for Trade and Foreign Agricultural Affairs Ted McKinney in testimony before the U.S. Senate Committee on Agriculture, Nutrition and Forestry in June 2019.

In 2017, Jeffery Albanese (pictured back row with hat), who was then Agricultural Attaché, USDA Foreign Agricultural Service, U.S. Embassy Manila, joined aUSW Board Team, with farmers from South Dakota, North Dakota and Montana, and USW staff,  for a tour of San Miguel Mill, Inc. in the Philippines.

USDA in general and FAS specifically foster such relationships by acting as strategic partners with USW through the extensive FAS network of foreign service officers serving in 98 offices around the world and its civil service support in the United States. The foreign service officers provide vital liaison with government officials and are active in market development work. The civil service likewise plays a critical role in everything from supporting the foreign service, managing the relationships with organizations like USW, providing market information, analyzing trade policy barriers, and much more.

FAS programs make it possible for wheat farmers to have representatives from USW who work directly with overseas wheat buyers, flour millers and wheat food processors and translate customer needs directly back to the state wheat organizations, who are in turn helping direct research for wheat crop development in their states. This leads to improved varieties and helps farmers manage their crops with the end user in mind, who would otherwise be thousands of miles and multiple steps apart in the supply chain.

A team of U.S. wheat farmers from Kansas, Oklahoma and Arizona bound for trade visits to customers in Nigeria and South Africa met in September 2016 with then USDA Under Secretary for Trade and Foreign Agricultural Affairs Ted McKinney (center) and other FAS staff in Washington, D.C.

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Listening Session Reinforces Support for Key Farm Bill Programs Impacting U.S. Farmers and Their Global Customers

Between ceiling-high stacks of seed and against a backdrop of multi-colored combines, House Agriculture Chairman Glenn ‘GT’ Thompson (PA-15) and U.S. Representative Tracey Mann (KS-01) conducted a food and agriculture listening session in early May. The remarks revealed support for the future of market development programs, food aid assistance and the continued reliability of the U.S. wheat supply.

The listening session took place at the farm of Justin Knopf, immediate past president of the Kansas Association of Wheat Growers. Trade teams may recall visiting this machine shed in Saline County, where farmers, ranchers, agricultural producers and leaders in Kansas agriculture gathered to provide their comments and questions. The current version of the Farm Bill expires on September 30, 2023, so this session is one of many happening across the country.

Photo of Kansas farmer Justin Knopf in his wheat field examining plant leaves for disease pressure with the front of a self-propelled application machine in the background.

Kansas Farmer Justin Knopf hosted a Farm Bill listening session in early May. “When we think about being the most reliable, consistent supplier of grain around the world to our international customers, crop insurance is an important part of our ability to do that,” Knopf said.

Farm Safety Net

“We heard a lot about the importance of the U.S. farm safety net from a production standpoint to feed not just consumers here in the U.S., but around the world,” said USW Vice President of Policy Dalton Henry.

Behind the shed, Knopf’s wheat crop is in better shape than many, but still below average. Knopf started his welcome by recognizing that thousands of Kansas wheat acres will not be harvested due to extreme drought conditions – a point repeated by numerous commentators. For these producers, crop insurance is a vital Farm Bill program, benefiting both farmers and customers that rely on a steady supply of U.S. wheat.

“When we think about being the most reliable, consistent supplier of grain around the world to our international customers, crop insurance is an important part of our ability to do that,” Knopf said. “Because in the wake of a disaster, it allows us the means to move forward in putting in that next crop that hopefully will fare better the following year.”

The Farm Bill provides direct support to overseas markets through food aid assistance, which both lawmakers and commenters expressed support for during the listening session. Kansas farmers, in particular, feel a strong tie to programs like USAID Food for Peace, the roots of which originated in Kansas.

“I’m very proud of the legacy of Food for Peace and food aid,” Knopf said. “We can stand as a country that is here to support people around the world that are experiencing hard, difficult times and provide food as a beacon of hope and freedom.”

Vital Export Market Development

Both lawmakers also recognized the importance of two other internationally focused Farm Bill programs – the Market Access Program (MAP) and the Foreign Market Development (FMD) program. These public-private partnerships provide competitive grants for export development and promotion activities to non-profit farm and ranch organizations, like USW, that contribute funds from checkoff programs and industry support.

Both programs need more investment to strengthen their effectiveness as MAP’s authorized funding has not changed since 2006 and FMD funding has remained the same since 2002. Congressman Mann is helping lead the effort to double the funding for this pair of agricultural export market development programs administered by the USDA’s Foreign Agricultural Service (FAS). He was a lead sponsor for the Agriculture Export Promotion Act (H.R. 648), which is currently making its way through the U.S. political process, along with the Senate equivalent – the Expanding Agricultural Exports Act (S. 176).

In the end, export promotion programs, food aid and crop insurance were just a few topics discussed at the Kansas listening session. Still, supportive comments from lawmakers and Kansans alike will help ensure the next Farm Bill supports not only U.S. farmers, but also their global customers.

By Julia Debes

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Japan Flour Millers Express Appreciation for Wheat Farmers While on First Visit to U.S. Since 2019

Eight executives from top Japanese flour mills arrived in the U.S. this week, bringing with them an astute observation about the global wheat market: Supply and demand have had an odd relationship over the past three years.

Through it all, Toshiaki Yokoyama emphasized, “the relationship between U.S. wheat and Japan has not wavered.”

During a meeting between U.S. Wheat Associates (USW) and the Japan Flour Millers Association (JFMA) on Monday, Yokoyama, JFMA Chair and Director of Nisshin Flour Milling Inc., expressed JFMA’s appreciation for the ability of U.S. farmers to produce a stable and consistent supply of high-quality wheat – even amid challenging times and conditions.

Members of the Japan Flour Millers Association pose for a photo with USW President Vince Peterson and USW Japan Country DIrector Rick Nakano following a meeting at USW headquarters.

Members of the Japan Flour Millers Association pose for a photo with USW President Vince Peterson (center) and USW Japan Country Director Rick Nakano (front row, far left) following a meeting at USW headquarters.

“Over the past three years, the spread of COVID-19 and Russia’s invasion of Ukraine have had a great impact on the relationship between wheat supply and demand, but the strong ties established over the years between Japan and the United States have remained solid,” Yokoyama said. “We are very happy to get back to the U.S. It is quite important to maintain and develop this good relationship under all circumstances, and we value continued cooperation by the U.S. wheat industry.”

JFMA, which also visited USDA and the Japanese Embassy during its time in Washington, D.C., was seeking updates on U.S. wheat production and exploring U.S. attitudes and opinions on biotechnology, including gene-edited wheat and drought-resistant wheat. International trade, disruption in the Black Sea region and the climate were other discussion topics.

It was JFMA’s first visit to the U.S. since 2019.

“These are our primary customers in Japan, which is regularly our second or third largest wheat market in the world, so we were very happy to have them here again and to be able to discuss things with them face to face,” said USW President Vince Peterson. “U.S. wheat has a long-term investment in Japan, and I believe they have a long-term investment in us, as well. It’s a great partnership and we are looking forward to continuing that partnership.”

Peterson and USW Vice President of Trade Policy Dalton Henry met with the JFMA team, which was led by Rick Nakano, USW Country Director in Japan. After its stop in D.C., the team moved on to Portland, Oregon, where it visited USW West Coast staff, state wheat associations in the Pacific Northwest, the Wheat Marketing Center and United Grain’s export facility.

See a brief video of JFMA’s visit to USW below.

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The Beginning of a New Food Security Initiative?

A new paper on food security submitted by the United States at the World Trade Organization (WTO) has to date received little attention but it could signify a meaningful shift in dealing with agriculture issues at the WTO. That paper, entitled “The World Trade Organization’s Role in Enhancing Food Security” suggests that facilitating rules- and science-based trade should be the basis for building global food security. The concept sets up a new approach to discussing food security issues that will span multiple areas of jurisdiction. Taking a new approach is critical as the current agenda is driven by countries set on only weakening existing WTO rules, which creates a breeding ground for trade distortions.

WTO logo and words: World Trade Organization.

Those who support an effective and predictable legal architecture for agricultural trade should want to see a WTO that is able to facilitate trade liberalization. This “reset” of the negotiating agenda starts small – the only next steps identified are additional submissions and discussions – but it will take time and sustained effort to overcome the inertia of the current agenda and reestablish the WTO as a useful negotiating tool.

Core Elements of Food Security

The paper focuses on food security, which is understandable since it is a major agenda item at the WTO. The war in Ukraine has put the issue in the spotlight; meanwhile, India continues to use a façade of food security to insist that WTO rules shouldn’t apply to them. That dynamic creates pressure to do something but action for its own sake can lead to poor outcomes for the trading system, especially if India is able to get the WTO to endorse its vision of food security. Unfortunately, there is no consensus on the time-tested ideas identified by the U.S. paper, namely that trade is critical to these core elements of food security:

  • Movement of Food – An open trading system is more resilient because it allows countries to adapt quickly to supply chain shocks. An open system also provides access to a more varied and nutritious diet, which is another important component of food security.
  • Innovation – Legal frameworks need to incentivize innovation while recognizing that one-size-fits-all practices are not possible and should not be imposed on trading partners.
  • Development – Support for trade facilitative infrastructure coupled with access to markets and innovations can reduce poverty and enhance food security.
  • Sustainability – Producers need policies that empower them to transition to more sustainable production practices and adapt to shocks. Well-intentioned but badly structured policies can have negative effects on the environment and trading partners.

Multiple WTO Jurisdictions

Those issues cut across WTO committee jurisdictions, which is why the paper was submitted to seven separate committees, not only the Committee on Agriculture. It also identifies in general terms how the WTO can enhance food security in work under these four categories.

Time will tell if this submission by the United States will be a soon-forgotten document with nice ideas leading nowhere, or if it is the beginning of a thoughtful, creative, and proactive approach to the cross-cutting issues facing agriculture and global food security. Private sector involvement and sustained leadership by like-minded governments will be critical in determining its future.

By Ben Conner, Partner, DTB AgriTrade, LLP

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USW Trade Policy Team Addresses India’s Subsidies, Turkish Flour at WTO

During World Trade Organization (WTO) meetings in Geneva last week, USW’s Trade Policy team was able to dig deeper into programs in India and Turkey that have potential to affect global wheat trade and ultimately the bottom lines of U.S. farmers.

It was also able to touch base with U.S. wheat allies on trade issues with those countries.

USW Vice President of Trade Policy Dalton Henry and Director of Trade Policy Peter Laudeman had several consultations with delegations from other countries about the situation in India involving subsidies and wheat stocks.

India’s wheat and rice public stock holdings have been an ongoing concern, as the country’s subsidies programs have resulted in an oversupply of domestic wheat and rice. When India’s government releases those grain stocks into the export market, it often does so at prices below what it initially paid to purchase the wheat. Studies show the distortion of international wheat and rice trade from these policies cost U.S. wheat farmers anywhere from $500 million to $800 million per year in lost potential income.

“We had some very good conversations and although we did not receive all the answers we are looking for on India, it was encouraging to learn there is international support,” Laudeman said.

“We had support at home, too, from U.S.A. Rice, which was very helpful. It is also very important for U.S. agriculture when separate groups come together to work on issues.”

Turkey’s “flour dumping” was also a topic addressed during USW’s visit to Geneva. Turkey maintains substantial domestic support programs that encourage overproduction of flour, which the government then sells into overseas markets at less than global price levels. USW estimates the dumped flour hurts domestic milling industries around the world and subtracts anywhere from $100 million to $500 million from U.S. wheat export demand each year.

“We were previously able to submit a question to Turkey regarding the Turkish flour program through the U.S. delegation,” Laudeman explained. “Both Brazil and Australia joined us on that question, so at the WTO meeting we met with delegations from those countries and thanked them for their support. We also made it clear to other groups we met with that we would love to have more allies join us, if it makes sense for them to do so.”

Face-to-Face in Brussels

From Geneva, Henry and Laudeman traveled to Brussels for the annual meeting of the International Grain Trade Coalition (IGTC), an international organization that advocates for better trade policies and global food security.

“Many of the trade barriers that U.S. wheat producers face today aren’t tariffs, but stem from restrictions on technologies used in agriculture, which is where IGTC really shines,” Henry said. “It gives us the opportunity to work hand-in-hand with countries that would normally be our export competitors to make sure markets remain open. IGTC has working groups ranging from pesticide MRLs (maximum residue limits) to plant breeding innovations, all of which are critical to U.S. growers.”

USW's Dalton Henry and Peter Laudeman attended the annual meeting of the International Grain Trade Coalition (IGTC), an international organization that advocates for better trade policies and global food security.

USW’s Dalton Henry and Peter Laudeman attended the annual meeting of the International Grain Trade Coalition (IGTC), an international organization that advocates for better trade policies and global food security. The meeting, held in Brussels, was the first in-person annual meeting in a few years due to the COVID pandemic.

The USW team was also able to meet new staff from global trade groups and get updated on several roles that transitioned during the pandemic.

“We were able to jump in and reengage with a lot of our grower and grain trade partners from all over the world,” Laudeman said. “If there is one key takeaway it’s that the global grain trade relies heavily on face-to-face interaction when it comes to supply chain relationships. This IGTC meeting was a good way to restart the interactions.”

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