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Wheat Industry News

News and Information from Around the Wheat Industry

Speaking of Wheat

“The Commodity Credit Corporation and USDA’s market development and aid programs are critically important at this time, and with this additional support we can strengthen U.S agriculture’s presence in existing markets, open up new market opportunities, and build on our relationships and connections to ensure that high-quality American agriculture and food products reach where they are needed in the world.” – U.S. Secretary of Agriculture Tom Vilsack announcing a new program adding funds to support U.S. export market development and international food assistance.

USW, State Commissions Welcome COFCO Trade Team

USW Hong Kong/China regional office is undertaking a first-hand look at the U.S. wheat supply chain and quality management systems for 8 wheat and flour industry managers with China’s COFCO agribusiness company. The trade team is planned to demonstrate to these purchase and quality managers that U.S. farmers, strong rail and river transport system, third-party quality certification and economical ocean freight from the PNW and Gulf provide a trusted source of wheat. State wheat commissions in Oregon, North Dakota, Texas, Kansas, and Ohio are hosting the team through early November. China’s U.S. wheat purchases have ramped up again in 2023/24 and, as of Oct. 12, 2023, include about 680,000 metric tons (MT) of soft red winter and 69,000 MT of hard red spring wheat.

USW staff and the COFCO team pause for a photo at the Wheat Marketing Center in Portland.

USW staff and the COFCO team pause for a photo at the Wheat Marketing Center in Portland.

Celebrating World Bread Day

U.S. Wheat Associates (USW) Manila, Philippines, office joined a celebration of World Bread Day (Oct. 16) at a Baking Demonstration Festival in Manila October 19 and 20. This was a joint project with the Filipino-Chinese Baking Association, Inc., and the Philippine Society of Baking that presented “BREAD OF THE WORLD,” filled with exciting new ideas, trends and innovations. The event featured free tastings, shared recipes to indulge in the goodness of baking fresh breads together. Several classes of U.S. wheat are imported by the Philippine milling industry to supply most of the flour consumed in that country.

Support For Conservation and Climate-Smart Agriculture

The USDA reported on October 16 that $1.77 billion has been issued through the Conservation Reserve Program (CRP) to agriculture producers and landowners. USDA Secretary Vilsack said, “These producers and landowners voluntarily place their land under contract and, in the spirit of stewardship, agree to establish and maintain prescribed conservation practices for the life of contract.” There are conservation efforts on more than 23 million acres of private land and a 21% increase in the acres enrolled since 2021.

Key Washington State Rail Line

The Federal Railroad Administration selected the state of Washington to receive a substantial $72.8 million Fiscal Year 2022 Consolidated Rail Infrastructure and Safety Improvement (CRISI) grant for capital improvements on the Palouse River and Coulee City (PCC) short line railroad. “This grant will allow the grain industry to respond to a critical need for improved transportation infrastructure and is deeply appreciated,” Washington Grain Commission CEO Casey Chumrau said. The railroad is an essential component of the Eastern Washington agricultural supply chain, facilitating the movement of the state’s high-quality wheat and barley to larger rail lines and on to both domestic and international markets.

National Wheat Yield Contest Winners

The National Wheat Yield Contest has announced the achievements of its 24 national winners, hailing from 12 different states, who have achieved an average yield of 144 bushels per acre (355 MT/hectare) across all categories. The National Wheat Foundation noted that growers demonstrated exceptional resilience this year. Despite facing adversity, with 59% of winter wheat production affected by drought on May 9, and 75% of spring wheat production impacted on July 25, these dedicated individuals showcased unwavering commitment to maximizing their wheat productivity in spite of environmental challenges. Read more here.

Subscribe to USW Reports

USW publishes various reports and content available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report, and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online

Visit our Facebook page for the latest updates, photos, and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and YouTube, and more on LinkedIn.

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McGarry Putting Away His Ledger After 40 Years at USW

McGarry was recognized for his 40 years of dedicated service to USW.

McGarry, USW’s Vice President of Finance, began as an accountant in 1983.

In late summer of 1983, Kevin McGarry left Ohio for the Nation’s Capital, where he would soon have two separate job offers to consider. One was with U.S. Wheat Associates (USW). The other was with Ringling Bros. and Barnum & Baily Circus.

Wheat farmers and flour millers, or clowns and elephants? McGarry didn’t have much experience with either cast of characters, but he went with his instincts. Exactly four decades later, he is retiring as Vice President of Finance at USW. His retirement is effective Nov. 1.

Starting as an entry-level accountant and working his way up to lead the Finance department has allowed McGarry to visit USW offices around the world – he took more than 50 international trips during his career to conduct audits and manage USW’s books.

“U.S. wheat helps feed the world; something everyone who works for the organization can be proud of,” he said. “I always kept that in mind, whether it was working with our farmers here at home or while visiting our offices in other countries.”

USW is Family

McGarry grew up in Akron, Ohio – the tire capital of the world. His father was a mechanic on the Goodyear Blimps. “I didn’t know a whole lot about wheat, agriculture or the export process when I came to USW,” he said. “What I discovered early on, and what was confirmed over and over through the years, is that the people in this industry are family, and what you would call ‘salt of the earth.’  Whether it was here in the U.S. or in our overseas offices, the USW staff, and the people I’ve interacted with have been the best part of my career. The farmers and board members were tremendous to work with. They really made these 40 years a joy.”

USW staff in its Arlington office celebrated the pending retirement of Vice President of Finance Kevin McGarry. McGarry, who will retire Nov. 1, has spent 40 years with the organization.

USW staff in Arlington recently celebrated the pending retirement of Vice President of Finance Kevin McGarry (seated with cake) by hosting a luncheon and reception. McGarry will retire Nov. 1.

USW President Vince Peterson has often joked that McGarry joined USW as an accountant but “quickly rose through the ranks to be its plumber, mechanic, electrician, party planner, HR manager and a host of other jobs” at USW’s Arlington Office.

Peterson said he has valued McGarry’s skills, dedication and ability to look ahead.

“Kevin has been a big part of our success over the past 40 years and is responsible for the fact that we have an organization that is financially sound, well-funded, and well run,” said Peterson, who joined USW shortly after McGarry and has worked closely with him ever since.

It was McGarry who led the charge to purchase its current office condominium 15 years ago – and then pay off its mortgage earlier this year. Both decisions turned out to be sound financial moves for USW.

McGarry poses with USW's Planning and Administrative Assistant Nada Obaid, left, and Meeting Planner Stacy Meade during a reception honoring McGarry.

McGarry poses with USW’s Planning and Administrative Assistant Nada Obaid, left, and Meeting Planner Stacy Meade during a reception honoring McGarry.

Speaking of Decisions

As a young man with a degree in accounting from the University of Akron, McGarry made the decision to move to Washington, D.C. without a job in hand. But he soon had offers from USW and Ringling Bros.

Was joining the circus a serious consideration?

“The job was ‘Road Controller’ and they were serious, and I was serious,” McGarry said.  “They flew me to Minneapolis to witness the circus in action on the road. They showed me the train compartment where I would live on the train. The job was 100% travel, except for about one month when the circus was down. At that time, a lot of their ticket receipts were cash. I would oversee converting that cash to payroll, because the circus workers wanted their pay in cash.”

After much consideration, including the fact that the USW job involved international travel, McGarry chose USW, which didn’t have a train for him to live on, but provided a solid organization and an admirable role in U.S. agriculture.  McGarry mentioned that when he started at USW, computers were scarce so he accounted for 16 overseas offices’ expenses by pencil on large green ledger sheets.

Plans in Retirement

McGarry will remain available “on call” to USW and his successor, Kurt Coppens, for a year as a senior advisor. Otherwise, he plans to continue his work renovating a pre-1800s house he purchased in a small town in Delaware. “The house came with a baby grand piano that I don’t know how to play, so I might learn how to play it,” he said.  McGarry recently earned an associate degree in auto mechanics taking night classes, so he’ll also enjoy his car hobby.

Does retiring McGarry have any regrets about 28-year-old McGarry not taking the job with the circus?

“I’m sure I would have a lot of good stories to tell had I gone that route,” he said. “But I have good stories to tell from my time with U.S. Wheat. The stories might not be as entertaining as circus stories, but USW does meaningful work, I’ve had a great career and have made great friends with great people. I’m humbled, and very appreciative.”

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Wheat Industry News

News and Information from Around the Wheat Industry

Speaking of Wheat

“I send my personal regards to all our Kansas Wheat Farmers here from South America. We will continue doing our best. I want them to know hard red winter is the most important class exported to our region. Today almost 10% of total U.S. wheat exports are coming to South America, and we know that there is a tremendous opportunity to continue developing markets for U.S. wheat farmers.” – U.S. Wheat Associates Regional Director, South America, Miguel Galdos, on the “Wheat’s On My Mind” podcast from Kansas Wheat.

October WASDE

USDA’s World Agricultural Supply and Demand Estimates (WASDE) for October for 2023/24 U.S. wheat this month is for higher supplies, increased domestic use, unchanged exports, and higher ending stocks.  Supplies are raised 85 million bushels. Exports remain at 700 million bushels with several offsetting by-class changes. Projected ending stocks are raised by 55 million bushels to 670 million, up 15% from last year. The global wheat outlook for 2023/24 is for reduced supplies, lower consumption, decreased trade, and lower stocks. Read the entire report here (link to: https://www.usda.gov/oce/commodity/wasde).

Remembering M.S. Swaminathan

The crop scientist who invited American crop breeder Dr. Norman Borlaug to India and is considered the father of India’s Green Revolution died Sept. 28 and has been the subject of several remembrances. When receiving the 1970 Nobel Peace Prize Dr. Borlaug credited Dr. Swaminathan with seeing the potential of cross breeding with Mexican dwarf wheat varieties to ensure standability in the new, higher yielding wheat. In 1987, Dr. Swarminathan won the first World Food Prize established by Borlaug.

Borlaug Dialogue 2023

Offered in live and virtual format the week of Oct. 16 and 23, this event will focus this year on harnessing innovation, adaptation, and diversification to improve systemic resilience, recover from shocks, and sustainably nourish all people. Building on Borlaug’s legacy of tackling immense global challenges, this year’s Borlaug Dialogue will both acknowledge how far the world has come and how to make positive strides toward a food-secure future. Learn more here.

Do Yourself a Flavor!

The North Dakota Wheat Commission encourages everyone to celebrate National Pasta Month in October. The Commission has celebrated Pasta Month for decades as a way to recognize the state’s durum producers, mills, and pasta manufacturers and the role they play in putting pasta on the plates of consumers around the world.  Each year, a new theme is developed to celebrate the occasion.  This year’s theme is “Do Yourself a Flavor!” — an encouragement for consumers to enjoy their favorite pasta dish or try a new recipe.

Demonstrating Federal Wheat Inspection Value

USW Beijing and the Federal Grain Inspection Service (FGIS) held a seminar on U.S. wheat inspection and certification in Guangzhou, China, in September. Eighteen mills from across China sent 32 participants to the seminar conducted by FGIS grain marketing specialist Barry Gomoll and Shirley Lu, USW Country Director, China, and held at the Sino American Baking School. USDA Agricultural Trade Office Director JonAnn Flemings addressed the customers and emphasized the long-standing commitment to Chinese customers. Read more about the value of third party, objective U.S. wheat inspection here.

Subscribe to USW Reports

USW publishes various reports and content available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report, and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online

Visit our Facebook page for the latest updates, photos, and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and YouTube, and more on LinkedIn.

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Wheat Industry News

News and Information from Around the Wheat Industry

“Some will say that’s just how markets work. Russia is being rewarded because it’s the low-cost [wheat] producer, and U.S. farmers aren’t keeping up. I would argue Russia is not a market-based producer, but is politically using cheap wheat as a tool for advancing military goals that are dangerous to international trade and to the African nations Russia pretends to serve. As is often the case, this is a situation that goes beyond economic theory and is challenging the future of American agriculture and international trade.” – DTN Lead Analyst Todd Hultman. Read more here.

U.S. Competitiveness Increasing

USDA reported that U.S. wheat commercial sales for the week ending Sept. 21 for delivery in marketing year 2023/24 (June to May) were 544,500 metric tons. That volume is up 77% from the previous week and 51% from the prior 4-week average. Export inspections for the week ending Sept. 21 were 584,600 metric tons, a marketing year high. Read more here.

Vessel at port loading wheat to illustrate how dry bulk freight rates have declined.

More Rain for More Grain?

In a seasonal outlook, the National Weather Service said Sept. 21 that “drought improvement/removal is likely” in the central and southern Plains, the heart of hard winter wheat production, through the end of the year. The USDA said that 47% of winter wheat land is in drought at present, up 1 percentage point from last week, but it is 10 points lower than at this time in 2022. Read more here.

Most Americans Think They Should Increase Whole Grain Intake

The vast majority of American consumers (77%) say they think they should be choosing whole grains more often, according to a new survey from the Oldways Whole Grains Council. The 2023 Whole Grain Consumer Insights Survey suggested consumers are increasingly seeking whole grain foods for health benefits and because consumers see them as tasty and sustainable. Millennials are significantly more focused on the sustainability benefits of whole grains compared to other generations. Read more here.

Upcoming IGC International Milling Courses

Courses in this curriculum area at IGC International in Manhattan, Kan., cover all aspects of managing the flour milling process from grain selection to finished products. Courses will explore many areas including; technical milling, mill management practices, quality control, food safety, flowsheet design, process automation and controls, process efficiencies, hard and soft wheat milling, maintenance, and much more. Click here to see upcoming courses.

More Evidence of U.S. Farmer Stewardship

The USDA reported on Sept. 19 a record interest in conservation and clean energy programs one year after President Biden’s Inflation Reduction Act was adopted. Over five years, the Act is funding almost $20 billion in Natural Resources Conservation Service (NRCS) programs to reduce greenhouse gas emissions and increase carbon storage. The Inflation Reduction Act made nearly $20 billion available over five years for USDA’s Natural Resources Conservation Service (NRCS) to serve demand for popular conservation programs. Read more here.

To show the productive quality of soil

USDA Investment in Food for Progress

Agriculture Secretary Tom Vilsack announced the U.S. is investing $455 million to strengthen global food security and international capacity-building efforts. The investment will utilize more than 375,000 metric tons of U.S. commodities. The commodities in the Food for Progress program will be sold in local and regional markets and proceeds will help strengthen short- and long-term food security. The commodities in the McGovern-Dole program will go directly to hungry school children to help address hunger and promote education. Read more here.

Wheat Industry Represented on USDA Advisory Committees

USDA’s Agricultural Policy Advisory Committee (APAC) for Trade provides advice on the administration of U.S. trade policy. U.S. Wheat Associates (USW) President Vince Peterson is an appointed member of APAC. The Agricultural Technical Advisory Committees (ATAC) offer technical advice and information about specific agricultural commodities and products to the Secretary of Agriculture. Wheat leaders serving on the ATAC for Trade in Grains, Feed, Oilseeds, and Planting Seeds are USW Vice president of Policy Dalton Henry, National Association of Wheat Growers Vice President of Policy and Communications Jacob Westlin, North Dakota Wheat Commission Administrator Neal Fisher, and USW Past President Ron Suppes of Dighton, Kan.

Subscribe to USW Reports

USW publishes various reports and content available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report, and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online

Visit our Facebook page for the latest updates, photos, and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and YouTube, and more on LinkedIn.

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Video: USW Brings Together Wheat Buyers For ‘Unique’ North Asia Marketing Conference

Three different countries, three different languages, three different cultures and three different sets of consumers. Yet flour millers from Japan, South Korea and Taiwan actually have something in common: They have a strong interest in U.S. wheat.

U.S. Wheat Associates (USW) invited wheat buyers from each country to Bali, Indonesia, August 28 and 29, 2023, for the 2023 USW North Asia Marketing Conference. The conference provides an opportunity for U.S. producers to meet their customers and share information about this year’s wheat crop. It also gives customers the chance to hear about each aspect of the U.S. wheat supply chain and learn about the global wheat market.

USW President Vince Peterson

Vince Peterson

“It is a very unique gathering because of the differences in the markets, but our staff in each of the participating offices is able to organize it in a way that brings wheat buyers together with everyone to share information and learn about all the advantages of buying U.S. wheat,” said USW President Vince Peterson. “In fact, you immediately notice a camaraderie as flour millers meet with farmers and others in the U.S. industry.”

The short video below captures some scenes as the conference opened on Aug. 28 in Bali.

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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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Russian Intervention Has Fueled Every Wheat Price Spike Since 2007

Editor’s Note: On March 11, 2022, U.S. Wheat Associates (USW) President Vince Peterson commented on the Russian government’s role as a source of great uncertainty for the world’s wheat producers, sellers and buyers. One year later, the price disruption of Russia’s unprovoked invasion of Ukraine continues. While prices have settled since the invasion started, the market still moves on every scrap of news from the Black Sea region. Reprinted here are Mr. Peterson’s views then, providing perspective today.

Once again, and tragically this time, Russian intervention is the underlying source of dramatic global wheat price volatility.

“…We are closely monitoring prices for the most essential social goods such as food, including bread,” said Russian Prime Minister Mikhail Mishustin this week about its domestic wheat supply. “Russian grain is in good demand from abroad, and its price is increasing. That said, it is necessary to provide the necessary raw materials, first of all, to the domestic baking industry.”

This Al Jazeera English report provides important insight into the situation in Ukraine one year after the invasion ordered by President Putin.

Consistent Protectionism

The Prime Minister made this comment with specific reference to the hyper reaction of global wheat prices to Russia’s invasion of Ukraine and the immediate impacts of the widespread economic sanctions levied on Russia in response. Yet it spotlights the core tenants of Russia’s protectionist and heavy-handed wheat supply and price control policies. Russian intervention has been front and center since the country first entered the global wheat export trade.

Anyone who does not take the Prime Minister at his word on this sets themselves up for a very disappointing and expensive lesson. Defending Russian domestic supplies and keeping domestic prices low by withholding supplies from the world will always be their primary wheat policy weapon. And they deploy it without regard for the harm and expense it creates for anyone.

Underscoring this point, the Russian Ministry of Economy confirmed on Mar. 11, 2022, that they are banning wheat exports through Aug. 31, 2022, to their fellow Eurasian Economic Union member states, including its Ukraine invasion staging partner Belarus, along with Armenia, Kazakhstan and Kyrgyzstan.

Every Spike Reveals Russian Intervention

In six documented situations since 2007, when the global wheat market showed any sign of stress, the government of Russia stepped in to impose an export ban, export tax or export quota to isolate their home market. These actions intentionally limited world wheat importers’ access to Russian wheat supplies. This Russian intervention further magnified any supply shortage and accelerated the rise in wheat prices.

Twice in this time frame, Russian military aggression against Ukraine directly caused world wheat prices to spike sharply. The world is reeling viscerally and economically from the shock of that situation right now.

Chart shows correlation between HRW futures price spikes and Russian intervention.

Correlations. Russian intervention is associated with the upward spike in hard red winter wheat futures prices. Factors include export restrictions, taxes, and, sadly, two invasions of its sovereign nation neighbor Ukraine. Copyright 2022 U.S. Wheat Associates.

Rampant Uncertainty

The COVID-19 pandemic lifted the tide of global inflation by disrupting global supply chains. Now, Russia’s war on Ukraine has blocked nearly 30% of the expected wheat export supply from governments and people that depend on it the most. Uncertainty runs rampant. And it is almost impossible to know how this war will be prosecuted. How long it will persist? What will the physical and economic situation of Ukraine and Russia be at the end?

Market analysts everywhere are trying to assess the many implications of this latest Russian intervention. Who will be most severely impacted? What will be the magnitude of the shortage created in the global wheat supply chain? And how will the world’s remaining supplies be apportioned, priced and relocated to the most severely affected countries?

Extreme Volatility

The extreme wheat price volatility seen in the past two weeks sits witness to this uncertainty.

Such high prices and volatility create challenges for the world’s wheat buyers and farmers and grain traders, who must also use the futures market to manage price risk. It is important to note that the U.S. wheat market remains fully open to importers and users everywhere. Dependable U.S. wheat producers and our reliable export system stand in the gap. They are ready and able to supply wheat as broadly to the world as our own supplies, and logistical capacity can accommodate.

Supplies Available

In addition to the wheat price inflation attributed to Russian intervention, U.S. wheat prices reflect that last year’s drought in the Northern Plains and Pacific Northwest limited current U.S. supplies. However, this year’s original export expectations and calculations do not include all U.S. supplies available. And wheat farmers will harvest a new crop starting in June.

U.S. Wheat Associates (USW) also creates additional value for U.S. wheat through the services it offers its customers. As they navigate this extreme market situation to secure the wheat necessary to feed people worldwide, USW remains ready to provide any information, tools and assistance within our means that may be helpful.

By USW President Vince Peterson

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U.S Wheat Reconnects with Brazilian Millers at Annual Industry Meeting

Building upon its long relationship with Brazilian flour millers while also learning about current market conditions across South America, U.S. Wheat Associates (USW) recently took part in the Abitrigo Congress in Foz de Iguazu, Brazil.

During this year's Abitrigo Congress, USW presented a course completion certificate for its Online Baking Certification program to the owner one of Brazil’s largest milling companies

During this year’s Abitrigo Congress, USW presented a course completion certificate for its Online Baking Certification program to the owner one of Brazil’s largest milling companies.

Abitrigo, the association representing the Brazilian wheat milling industry, had not held an in-person annual meeting since 2019. USW President Vince Peterson said attendees from all industry sectors were thrilled to finally be able to engage in business face-to-face.

“Everyone we spoke with noted how nice it was to be back together,” said Peterson, who was joined by USW Vice Chairman Michael Peters and staff members from the USW Santiago Office. “Our presence is a way to show how important Brazilian millers and buyers are to U.S. wheat producers and the entire U.S. wheat industry. It gives us an opportunity to interact with key wheat buyers and have discussions with both new and long-time representatives of the mills.”

Peters, who was attending his first Abitrigo meeting, was impressed with the work of the USW Santiago office, which was represented by Regional Director Miguel Galdos, Assistant Regional Director Osvaldo Seco, Technical Specialist Andres Saturno and Senior Marketing Specialist Claudia Gomez.

“It was very clear that our staff has tremendous relationships with millers in that part of the world and have earned the respect of the industry,” said Peters, a wheat producer and cattle rancher from Okarche, Oklahoma. “It is a tough and competitive market for U.S. wheat, but we’ve remained connected and have done a great job of maintaining U.S. wheat’s reputation for providing a high-quality product.”

USW took center stage during one segment of this year’s meeting when it presented a course completion certificate for its Online Baking Certification program, a new USW technical project that promotes baking methods using all six U.S. wheat classes. The recipient owns one of Brazil’s largest milling companies.

“Having a significant business owner take her personal time to take the USW baking course is quite a compliment,” Peterson noted.

Abitrigo provides more information about its endorsement of the USW Online Baking Certification program on its website.

While Brazil has been importing U.S. wheat for more than 40 years, it still is an extremely competitive market due to Brazil’s domestic production and advantages enjoyed by some U.S. competitors, including Argentina and other countries that have mostly duty-free access under the Mercosur Agreement. In 2019, Brazil agreed to implement an annual duty-free tariff rate quota (TRQ) of 750,000 metric tons of wheat imports from countries not part of the Mercosur Agreement.

Peterson pointed out that the quality of U.S. wheat remains desirable to many Brazilian buyers.

“The core of the Brazilian milling industry recognizes that U.S. hard red winter (HRW) and soft red winter (SRW) wheat – and even hard red spring (HRS) wheat, which has been purchased by Brazilian customers this year – are the most applicable wheat sources to produce the best quality Brazilian wheat food products. Because of this, the market continues to be a long-term priority. And we will continue providing the best service and support we can to Brazilian millers and bakers.”

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Effects of 1980 Grain Embargo Echo Through the Years

By Vince Peterson, USW President

As a new decade and a new future for wheat export market development dawned in January 1980, the urgency facing the wheat-producer boards of both Great Plains Wheat and Western Wheat Associates could not have been much greater.

They were under the strain of discussions and negotiations for months in the effort to merge the two existing regional wheat market development groups into one, single national association. Then, on January 4, these farmer leaders and all U.S. wheat producers sat in disbelief hearing President Jimmy Carter address the nation and summarily cancel 17 million metric tons (MMT) of existing wheat, corn and soybean sales contracts between U.S. exporters and the former USSR. That was 17 MMT of production that had already been grown and harvested and scheduled for movement by truck, barge, rail car and ocean vessels through the U.S. grain export system; 17 MMT of system revenue, margins and farmers’ annual income – all cancelled.

In announcing this action and a longer-term grain embargo as sanctions against the Soviet Union’s invasion of Afghanistan, the President promised protection to farmers. He also said he had faith that our competitors would not exploit the opportunity to take up the cancelled U.S. sales. Never was such a naïve assumption more foolishly made. Spurred on by the unfilled Soviet demand, export origins in Europe and South America were quite literally handed a windfall on a silver platter. It is hard to criticize them for taking up that opportunity, but that was the spark for many of them that launched them into a new permanent place as competitors of the United States in the export market.

A crisis was at hand and it was becoming clear that no action of the government was going to heal the long-term financial damage and repair the loss of export markets suffered on that day. Those making an honest historical analysis can fairly claim that the next 20 years of high inventories, stagnant prices, booming farm programs and an export subsidy war all had their roots firmly planted in that one single policy decision.

The newly founded U.S. Wheat Associates (USW) had more than its hands full as a national market emergency now far outpaced any internal issues that may have seemed monumentally disagreeable during the merger discussions. Those were now just minor bumps in the road by comparison to the tasks in front of them. Ultimately, USW’s new leaders and staff fought hard to replace the lost export sales, build a reputation for reliability and create a more conducive policy environment for global trade.

Never Again

One of the longer-term benefits to the U.S. wheat industry and its domestic and overseas customers that came out of this very difficult time originated in a very simple thought and demand: “This can never be allowed to happen again.” The U.S. grain export industry from farm to port were all completely unified in the pursuit of legal protection from an action of this nature for all time. These political efforts were successful. The U.S. Congress eventually passed, and the President signed, new contract sanctity laws which, short of a national emergency or war, precluded even the President from canceling any pre-existing grain export sales contacts.

The implications of this important protection echoes through the years to today, a new time of global crisis and uncertainty in the face of the coronavirus pandemic. Selfish hoarding is causing shortages and prices to rise. To combat that, some countries retreat behind protectionism to limit, tax or cut off exports in order to secure their own domestic supplies and hold down inflationary prices at home – with little apparent concern about the effects their actions will have.

Today, very concerned import-dependent countries are rightly asking: “Are there adequate supplies of wheat in the United Stated to cover all of our demand? Is there hoarding or a price shock? And, will our vessels be loaded?”  We are quite humbled and yet proud to be able to tell them yes, there is plenty of wheat available. In the commercial market, there is no hoarding and prices remain relatively low during this time. Perhaps most importantly, as opposed to governments that hide from global obligations, the U.S. government has declared the entire U.S. food industry, from farm to table and to export, to be essential services. We are also very pleased to know USDA’s agencies that handle grain inspection and phytosanitary compliance and certification are committed to making every effort possible to maintain those services to both domestic and export markets during this time.

No Export Taxes

As for the export taxes that some countries are so quick to consider and employ as the easy tool to control their own domestic market and economy, our country’s founders took care of that issue for us in 1787 when they wrote the Constitution of The United States of America. Article I, Section 9, Clause 5 states that “No Tax or Duty shall be laid on Articles exported from any State.” No export taxes. Period.

Situations such as the Soviet Grain Embargo and, perhaps, the coronavirus pandemic, while very difficult to experience and understand, can provide lessons and new policies that continue to serve wheat farmers, our country’s export supply industry and our customers securely and quite well.

Today, in part because of what happened back in 1980, the U.S. wheat store remains open, equally and fairly to all market participants at home and abroad.

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An Invitation to a Stronger Relationship with Mexico’s Milling and Wheat Foods Industries

By Vince Peterson, USW President

Today, I had the unique privilege to accept an invitation to the White House to represent U.S. wheat farmers, our state wheat commission members and U.S. Wheat Associates (USW) as President Donald Trump signs implementing legislation for the U.S.-Mexico-Canada Agreement (USMCA) into U.S. law (that’s my viewpoint at the ceremony in the picture above).

While this invitation came addressed to me, it is only because I occupy a specific desk at USW with the consent of our U.S. farmer board of directors. I sincerely hope that everyone associated with our organization feels the same pride I do to witness this important national event because everyone put in a tremendous amount of work to help bring it about.

The trade agreement USMCA will replace (after Canada’s parliament approves it and implementing changes are made, as we are sure will happen) opened mutually beneficial trade between U.S. wheat farmers and Mexico’s flour millers and wheat food industry. Under the North American Free Trade Agreement (NAFTA), USW focused on helping Mexico’s buyers, millers and food processors solve problems or increase their business opportunities with U.S. wheat classes—as it does with all U.S. wheat importing customers. This effort, supported by wheat farmers and the partnership with USDA’s Foreign Agricultural Service, has fostered a productive relationship that has endured through many challenges.

So, when the Trump Administration announced in 2017 it intended to renegotiate NAFTA, USW quickly engaged in the process on many levels to advocate for continued duty-free wheat trade and other improvements in the agreement.

For example, I invited José Luis Fuente, President of the Mexican Millers Association (CANIMOLT), to address the USW board of directors meeting in October 2017. Sr. Fuente had been appointed as an advisor to the Mexican Minister of Agriculture in the negotiations. He made a passionate plea for USW to work together toward resolving the trade agreement as soon as possible. In addition, our former Vice President of Policy Ben Conner was granted status as an advisor to the U.S. Trade Representative and was one of only a few agricultural industry representatives who participated in side-briefings at almost all the official negotiating sessions. Vice President of Communications Steve Mercer, his team and our friends at the National Association of Wheat Growers (NAWG) published an on-going series of press statements, social media posts, comments and fact sheets supporting our positions. As the U.S. Congress considered the agreement, NAWG’s staff and its dedicated farmer officers and directors continued to advocate for its passage.

Regional Vice President Mitch Skalicky and our staff in Mexico City steadfastly maintained contact with Sr. Fuente and our other customers. Then, last year at a USW marketing conference in Mexico, USW and Mexican millers renewed our agreement to work together toward approval of the USMCA. We also made it very clear that our commitment to serving their industries was among our most important goals.

“We have 14 farmers here representing 13 different state wheat commissions, and U.S. Wheat Associates staff from 3 offices here to show you that we take your business seriously,” Past Chairman Chris Kolstad told the millers. Those farmers, state commission members and USW, he added, “are all united in our desire to earn your full trust in the United States as your primary source of imported wheat.”

After I received the White House invitation to the USMCA signing ceremony, I forwarded a copy to Sr. Fuente with a note of thanks and congratulations to him and CANIMOLT members for their work and the collaborative effort toward a favorable agreement for each of us.

“We congratulate U.S. Wheat Associates on behalf of the Mexican millers for all of the collaborative work, negotiations, and achievements attained (in negotiating the new USMCA),” Sr. Fuente responded to Mitch Skalicky and me. “I am very happy and proud to have been part of the effort and above all to confirm the excellent relations and friendship that exists between the Mexican milling industry and the U.S wheat industry.”

That is a humbling and generous confirmation that our relationship stayed strong throughout the negotiations. USW will continue to work hard to make our partnership even stronger in the future.

José Luis Fuente, President of CANIMOLT, addresses the USW Mexican Wheat Trade Conference in June 2019.

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