September 1997
WHEAT 
WORLD
Activities Funded in Part by the Minnesota Wheat Checkoff
Library
Home
E-Mail
Back
Prairie Grains is the
official publication of
the Minnesota
Association of
Wheat Growers,
North Dakota Grain
Growers Association,
South Dakota Wheat,
Inc., and the
Minnesota Barley
Growers Association.
Alan Tracy has been selected as the new president of U.S. Wheat Associates (USW). Tracy's long career in agriculture includes serving as Special Assistant to the President for Agricultural Trade and Food Assistance from 1986 to 1989, as well as holding several positions at the U.S. Department of Agriculture, including Deputy Assistant Secretary of Agriculture for Marketing and Inspection Services, Deputy Undersecretary for International Affairs and Commodity Programs, and General Sales Manager.
From 1970 to 1981, Tracy worked in his family's farming business in Wisconsin, which produced hybrid seed corn and raised hogs and cattle. He served as president of the business from 1976 to 1981. Tracy holds a bachelor's degree in agricultural economics from Cornell University and a master's degree in international business from the University of Wisconsin.
Most recently, Tracy had been serving as Secretary of the Wisconsin Department of Agriculture, Trade and Consumer Protection.
Tracy replaces Winston Wilson, who had served as USW president since 1981.
Briefing alleviated Japanese concerns of Valley flooding
Flour mills in western Japan received an early assessment of this year's U.S. wheat crop from USW/Tokyo Director Bob Bratland and Assistant Director Seiji Terada. Twelve milling industry representatives attended the briefing, which focused on the condition of the hard red winter and soft white crops and the outlook for the 1997 hard red spring and durum crops. Bratland and Terada held the briefing in response to widespread Japanese press coverage about the adverse weather conditions in U.S. wheat-growing areas, particularly spring flooding in the Red River Valley and the early April frost in the lower Great Plains.
Properly stored wheat as good as new crop
One question that international grain buyers often ask concerns the newly harvested crop versus the previous year's crop in storage. "Some buyers want only the new crop," says USW/Cairo senior regional marketing specialist Abdel-Ghaffar. The question came up from a Middle East trade team that visited Kansas this summer. U.S. grain company representatives assured team members that, given proper handling, the old crop is just as good as the newer crop.
The participants wanted to know how long wheat can be stored in silos. A terminal elevator manager told them grain companies can store wheat indefinitely if elevator personnel utilize proper temperature controls. "We will turn and treat the grain, and keep it cool and insect-free," the Kansas manager said. "It's a matter of good management."
USW helps McDonald's build a better bun in China
U.S. Wheat Associates (USW) Hong Kong-based bakery specialist Franco Lee recently conducted in-plant training and consultations for one of McDonald's major hamburger bun manufacturers, Garden Company. The company uses flour processed solely from U.S. wheat in order to meet McDonald's strict quality requirements. Sino-American Baking School instructors Philip Zhou and Chen Mingliao helped Lee to train 25 staffers from Garden Company's plant in China's Guangdong province. Although based in Hong Kong, the company began selling buns to China in the 1980's when McDonald's began expanding its operations there. The expansion has forced Garden Company to hire more knowledgeable line personnel and quality control staff. Chinese processors respect Lee, one of the first managers of a McDonald's hamburger bun processing line in Asia, for his ability in both baking theory and application. The number of McDonald's and other fast-food outlets is expanding throughout the world, with several of the outlet chains turning to USW for assistance in bun formula development.
Japan replaces Egypt as top importer of U.S. wheat for 1996/97 marketing year
For the 1996/97 wheat marketing year, Japan replaced Egypt as the leading receiver of U.S. wheat, surpassing Egypt, the 1995/96 marketing year leader, according to the USDA. The wheat marketing year began in June 1996 and ended in May 1997. For the 1996/97 marketing year, Japan received 119.9 million bushels of the total U.S. wheat exports of 1.010 billion bushels. The other top five receivers of U.S. wheat were Egypt, with 103.7 million bushels; Pakistan, with 72.5 million bushels; Philippines, with 68.9 million bushels; Korea, with 60.5 million bushels; Mexico, with 54.8 million bushels; and China, with 39.1 million bushels. China, the leading receiver of U.S. wheat during the 1991/92 and 1 990/91 marketing years (importing 208.9 million and 139.6 million bushels, respectively) continues to be one of the leading receivers of U.S. wheat, but not on the scale of the past 4 marketing years. The Canadians imported 33.1 million bushels of U.S. wheat for the marketing year. The total U.S. wheat exports of 1.010 billion bushels was down nearly 300 million bushels from the previous marketing year total of 1.306 billion bushels. The 1996/97 wheat marketing totals are not all that bad, compared to a decade ago, when there were 1985/86 and 1986/87 marketing year totals of 818.9 million and 901.3 million bushels, respectively.
German trade shows interest in U.S. wheat
A recent visit to Germany by USW/Rotterdam Marketing Specialist Goris van Lit turned up some interest in U.S. wheat among German importers. The representatives of major milling and trading companies who met with van Lit focused on U.S. spring and durum, an interest reflected in recent German purchases. In addition, the German millers association asked that Germany be included in USW's upcoming crop quality tour, now scheduled for November.
USW chairman and president visit Russia and Poland
A visit to Moscow to attend the 75th anniversary celebration of Russia's grain importing organization highlighted a recent trip to Europe by U.S. Wheat Associates (USW) Chairman Joe Berry, Wilson, USW Regional Vice President Vince Peterson and Marketing Assistant Valentina Shustova.
The seven-hour event for Roskhlebo-produkt, once run by the government but now a semi-private company, included a speech by Wilson that praised Russian privatization efforts and expressed appreciation for the U.S.-Russian business relationship. Some 1,500 representatives of the world grain industry attended the event. While in Russia, Berry and Wilson also met with representatives of Exportkhleb, OGO, and Roskhleboprodukt to discuss the current Russian wheat situation.
Berry, Wilson, Peterson and USW/Rotterdam Marketing Specialist Goris van Lit then traveled to Poland to visit Rolimpex, one of the more progressive commodity marketing agencies in Eastern Europe.
Dickerson continues series of import seminars
U.S. Wheat Associates (USW) Vice President Paul Dickerson recently conducted import seminars in Morocco, Turkey, Istanbul, Ankara and Izmir as part of an on-going series of seminars being held around the world. The seminars are in response to the rising level of wheat privatization occurring in countries throughout the world, which is increasing the need for education about the U.S. wheat market among first-time U.S. wheat importers. The seminars also are useful for more knowledgeable importers who would like to take advantage of U.S. wheat marketing options. The meetings focus on purchasing alternatives and risk management strategies such as buying U.S. wheat unpriced (fixed basis, futures to be fixed at later date) options trading and blending wheat classes to take advantage of price spreads. Also discussed were world wheat supply/demand conditions.
Status of wheat business with change in Hong Kong
The greater change with Hong Kong will be noticeable five to ten years down the road. And, China may also change as a result of influence by Hong Kong , according to USW regional vice president Matt Weimar, regarding the turnover of the city from Britain to the People's Republic of China.
China's national flag has been raised along with the flag of the new Hong Kong Special Administrative Region (HK SAR) rather than the British flag and Hong Kong's old flag. Most private organizations have also removed "royal" from their names and emblems. Chinese language will become more dominant for official government-communication whereas in the past both were considered equal.
But as far as official U.S. business is concerned, "Hong Kong is not changing in status as a separate consular area. Hong Kong's statistical recording and import and export status as far as customs and sanitary practices will remain independent and unchanged," says Weimer.
One mill in Hong Kong, three mills in Shekou and a few other operations in southern China, combine to make up about 40 percent of total Hong Kong flour use. Of the remaining flour imports, 50 percent come from Japan, with the USA, Canada, Australia, Southeast Asia and Europe contributing the final 10 percent."
Hong Kong's population stands at 6.5 million, according to Weimar. Per capita use of flour is about 75 pounds which is up about 10 pounds from the early 1990's. Per capita income was growing at about 10 percent a year. Government estimates indicates 1997 per capita income will exceed US$27,000. Wheat foods consumed in Hong Kong include noodles (Chinese-and Japanese-style) 30 percent; western-style breads 30 percent; Chinese-style steamed breads, steamed dim sums (appetizer and snack foods) 20 percent; cookies and crackers 10 percent and cakes 10 percent.
Russian grain millers visit MN, ND
Directors of newly-privatized grain mills in Russia visited North Dakota and Minnesota this summer to learn more about the U.S. spring wheat industry.
Decentralization in Russia of grain purchasing and privatization oaf grain trading, milling, and processing has brought to the marketplace new buyers who previously, under the centralized, state-controlled monopoly for grain procurement, have had little access to the international grain trade, and have no experience in grain purchasing. Consequently, Russia's private grain trading sector and mills in the region are attempting to familiarize themselves with the international grain market.
The grain milling executives who visited are from a part of Russia (mostly St. Petersburg, with a population of about 4.9 million) that is not able to produce enough grain for its own consumption needs, and is considered a wheat-deficient area.
The heads of four mills, including the largest mill in northwest Russia and the only durum mill in the region, visited the Northern Crops Institute in Fargo, the Minneapolis Grain Exchange, and the Port of Duluth (shown in photo) during their visit. The Minnesota Wheat Research and Promotion Council, which administers the wheat checkoff in Minnesota, co-hosted the Russian grain millers trade team visit.
WHEAT WORLD is brought to you by the producer-funded Minnesota Wheat Research and Promotion Council, provides insight about U.S. Wheat Associates, the export market development organization representing U.S. wheat growers through 18 state wheat organizations:AZ, AR, CA, CO, ID, KS, MN, MT, NE, NC, ND, OK, OR, SD, TX, VA, WA, and WY.