This year U.S. Wheat Associates will receive $10.6 million from USDA’s Market Access Program and Foreign Market Development Program under the new Farm Bill.
That’s a 6% increase over last year.
The organization, which is the overseas marketing arm for the industry, also received $8.3 million, to be distributed over three years, under the Agricultural Trade Promotion program.
Steve Mercer, vice president of communications for U.S. Wheat, said the organization cannot share specific activities and strategies in a competitive situation, but provided general examples of activities in markets with good growth potential for U.S. wheat imports.
Milling wheat imports are growing. The current annual total of 2 million metric tons is roughly 25% above the five-year annual average.
“Growth in the confectionary, cookie and cracker market is where we will compete best with U.S. soft white wheat from the Pacific Northwest, but also in large bakeries that need stronger flour from U.S. hard red spring and hard red winter wheat,” Mercer said.
Australia continues to compete in the large noodle flour market, but Vietnamese flour mills want to improve their technical capabilities. U.S. Wheat will focus on providing technical support while demonstrating why U.S. wheat classes provide more value.
“This is a market likely headed to becoming the world’s largest wheat importing country,” Mercer said.
Potential demand for soft white, hard red spring and hard red winter is growing. U.S. Wheat will provide technical support to millers and processors through the USDA programs to gain for a bigger share of the market.
“We will focus on helping buyers better understand how to write tenders to get the most value from U.S. wheat and work with the wheat food manufacturers to show them why U.S. wheat flour offers superior results to Australian wheat and wheat from other origins,” Mercer said.
U.S. Wheat recently heard from a large milling and baking company owned in part by Australian wheat interests that they continue to import a sizable portion of U.S. wheat because the technical support is helping them improve their results.
Although U.S. wheat continues to compete against Brazil’s tariff free access to Argentine wheat under a regional trade agreement, “we are increasing our trade service and technical support to millers and bakers to build contacts in anticipation of future activities,” Mercer said.
In years when wheat crops in Argentina and Brazil are down, customers need to be prepared to use U.S. hard red winter from Gulf ports. This included technical milling seminars and a baking course in 2018. Similar activities are planned for 2019 and future years.
“New opportunities exist, even in these markets where Russian supplies dominate the price-conscious government imports,” Mercer said.
He cited growing demand in the private sector for niche premium bread products requiring higher gluten strength flour and confectionary products best made with flour from soft wheat classes. This creates new opportunities for U.S. hard red winter, hard red spring, soft red winter and soft white wheat imports, he said.
U.S. Wheat will work with private mills to make recommendations on how to produce the right types of flour for these markets, and with bakers to demonstrate how to evaluate their flour and produce higher quality products more efficiently, Mercer said.