Rediscover Wheat - August 2016

TM

The official publication of the Kansas Wheat Commission and the Kansas Association of Wheat Growers

AUGUST 2016

INSIDE THIS ISSUE

Wheat buyers conference positions U.S. wheat as an exceptional value Is temperature changing genetic resistance to pests?

2016 Loan deficiency payments now in effect.

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In This Issue :

TM

Volume 3 • Number 8 www.rediscoverwheat.org The official publication of

1990 Kimball Avenue Manhattan, Kansas 66502 (785) 539-0255

KAWG MEMBERSHIP $100 per year

EDITOR

Marsha Boswell • mboswell@kswheat.com

ASSISTANT EDITOR/DESIGNER

CONTRIBUTORS

Malerie Strahm • commintern@kswheat.com

Jordan Hildebrand • jhildebrand@kswheat.com

CEO

Justin Gilpin • jgilpin@kswheat.com

KAWG OFFICERS PRESIDENT Michael Jordan • Beloit

VICE PRESIDENT Kenneth Wood • Chapman SECRETARY/TREASURER Justin Knopf • Salina IMMEDIATE PAST PRESIDENT Gary Millershaski • Lakin

KWC OFFICERS

CHAIRMAN Jay Armstrong • Muscotah VICE CHAIRMAN Brian Linin • Goodland SECRETARY/TREASURER Mike McClellan • Plainville IMMEDIATE PAST CHAIRMAN Scott Van Allen • Clearwater

Rediscover Wheat is published by the Kansas Association of Wheat Growers (KAWG) and the Kansas Wheat Commission (KWC), 1990 Kimball Avenue, Manhattan, Kansas 66502, twelve times per year.

Contents of this publication may not be reprinted without permission.

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Wheat Buyers Conference positions U.S. wheat as an exceptional value.

Is temperature changing genetic resistance to pests?

GMO Bill signed into law by POTUS, Kansas Legistlative Update 2016 Loan deficiency payments now in effect.

Recipe: Italian garlic bread burgers IGP Institute: Stakeholders News Brief News from the National Association of Wheat Growers News from U.S. Wheat Associates Recipe: Fresh peach pie Maltby Market Analysis Upcoming Events

Wheat Buyers Conference Positions U.S. Wheat as an Exceptional Value

by Steve Mercer, USW VP of Communications

U

.S. Wheat Associates (USW) and nine state wheat commissions hosted 75 flour millers and other buyers at a Latin American and Caribbean Buyers Conference June 21 to 24, 2016, in Portland, OR. USW President Alan Tracy said the information at the conference was specifically selected and timed to emphasize the excellent value of U.S. wheat for these buyers from 16 countries.

Tracy noted that several speakers at the conference focused on how current world market dynamics make U.S. wheat an attractive choice for importers.

That is an important message because income from wheat is linked to export markets and the buyers in Latin America are taking 40 percent of all U.S. wheat exports with great potential for growth. He said these are markets that also buy on the basis of the quality characteristics U.S. wheat farmers produce every year.

At the conference, Kansas Wheat CEO Justin Gilpin

gave an inside look at hard red winter wheat and the increasing investment in innovation that farmers are leading. He told the buyers that the quality of the new hard red winter crop is very good ‌ the kind of wheat you want in every grist, he said. Kansas farmers and farmers across the United States are leading the call for increased investment in wheat yield and functional quality.

Gilpin said work at Heartland Plant Innovations, funded mostly

by Kansas farmers, is already paying off for flour millers in new varieties with higher extraction rates.

Representing the Latin American marketing group from CHS Inc., Dan Barnard discussed how the current market gives hard red winter wheat exceptional value. Referring to the 75 cents per bushel premium in mid-2017 futures prices he told the buyers that they will have the best access to hard red winter at the least cost over the next three to four months.

According to USW Vice President of Operations Vince Peterson, there are more timeless reasons why a large conference like this is worth the investment and effort. He said USW has held a Latin American conference every other year for nearly 25 years. With these buyers all in one place, the industry can talk in person about the markets and about how U.S. wheat fits into their businesses and that builds trusting relationships, Peterson said.

German Zapata, a wheat buyer from Colombia agreed that traveling to the conference gave him and his colleagues the opportunity to consider U.S. wheat in a very different way.

Standing on an Oregon farm after the conference, Zapata said it was amazing to experience the whole process of wheat production and marketing, seeing the land and the technology farmers have, and how they work to produce the best quality wheat.

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Is Temperature Changing Genetic Resistance to Pests?

by Malerie Strahm

W

e humans may not have adapted to this summer’s sweltering rays, but for a few agronomic pests, warmer weather is what makes them thrive.

With temperatures rising and insects adapting, the days of following a “fly-free” date for wheat planting are fading. In the past, a “fly-free” date meant that after a certain day in October, depending on location, wheat could be planted without weeds and without infestation of Hessian flies. When flies started showing up in October and into January, Mike Smith and his team of scientists including Jeff Whitworth, Dr. Holly Schwarting and Dr. Ming Chen, started to investigate how temperature was affecting these populations.

“We started looking at varieties, and we started seeing that some of these varieties that used to be resistant were no longer resistant,” said Smith, professor of entomology at Kansas State University.

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In a controlled environment consisting of about 12 Hessian fly resistant varieties of wheat grown in Kansas, it was found that only half were actually resistant and the other half weren’t. This led to this year’s project, an actual field experiment with wheat planted at different areas in the state looking at Hessian fly resistant varieties, known susceptible varieties and some new varieties with unknown resistance. Smith is looking for the same thing to happen in the field as in the growth chamber to see how the resistant genes hold up against higher temperatures.

“It’s also known that some Hessian fly resistant genes in wheat are affected by higher temperatures, but we don’t know enough about the pedigrees of these lines to know if that’s the case.,” said Smith. “But the bottom line is, not only the climate changing but also something in the genetics of the varieties is changing. So that’s what we’re trying to get to the bottom of.”

These varieties will also be screened for resistance to the wheat curl mite and Russian wheat aphid. Although the most visibly destructive pest is the Hessian fly, these other pests are known to cause significant damage.

“Hessian fly’s probably the poster child for wheat entomology or has been for a long time.

However, the wheat curl mite is becoming more of a problem.

The wheat curl mite vectors three significant viruses on wheat:

Hessian Fly. Photo by Jimmy Hatchett, Department of Entomology, Kansas State University

wheat streak mosaic, Triticum mosaic and wheat mosaic,” said Smith.

The combined losses of the mite feeding and vectoring viruses can sometimes be as high as the Hessian fly, of up to 15-20 percent yield loss, according to Smith.

Some locations in some states that have a very concentrated epidemic of a virus can see up to 100 percent yield loss.

Although the Russian wheat aphid poses the lowest threat statewide, dryland wheat of western Kansas and eastern Colorado is particularly susceptible to this pest..

Smith and his team anticipate finding that varieties claiming resistance may now be susceptible to certain pests and that some of that change is due to temperature.

If they are successful in their research, it will provide a basis for crop improvement and give direction on how to adapt wheat to combat changes in the environment and pests.

GMO Bill Signed into Law by POTUS

President Barack Obama signed the GMO labeling bill on July 29, 2016. This historic bill will require the mandatory labeling of food that contains genetic engineering. The legislation gives food producers the option to either label their products with wording or a symbol, or to provide a smart phone accessible digital QR code that when scanned, discloses information concerning whether the food contains ingredients made with biotechnology. The newly signed law will preempt a potential patchwork of statebased GMO labeling laws that could’ve caused chaos in the national food manufacturing and distribution system. With the President’s signature, the next step will be implementation of a national labeling system by the U.S. Department of Agriculture.

Kansas Legislative Update A

t 3:30 in the morning on May 2 the Kansas Legislature passed a budget that wrapped up the 2016 Regular Legislative Session. Legislators worked through the weekend trying to fill an estimated $290 million budget shortfall.

The budget that was passed early that morning totals $6.3 billion and will require the Governor to make additional cuts to programs and services in order to balance. The budget bill did not include any revenue or tax increases despite failed attempt to repeal the 2012 income tax cuts for LLCs and sole-proprietorships. On May 18 the Governor announced $97 million in additional cuts to balance the budget. After it is all said and done, here is a breakdown of the relevant cuts that could potentially affect Kansas Wheat: • Kansas State University – $9.1 million cut • Kansas Department of Agriculture – $1.2 million cut • Kansas Department of Transportation – $115 million cut • Kansas State Extension - $1.3 million cut In addition to the regular session the Governor called the legislature back to address the Supreme Court’s ruling on school finance. On May 27 the court ruled that the school finance formula was

“unequitable” and therefore unconstitutional. As a result, the state would have no way to constitutionally fund the schools and they would all have to shut down on July 1 unless the legislature fixed the funding formula.

The legislature reconvened in Topeka to address the school finance crisis on the morning of June 23 and they adjourned by sundown on June 24. The Legislature passed its fix almost unanimously, a rarity in Topeka, especially in an election year.

The fix was also approved by the Kansas Supreme Court and it ensured that all schools would be open this fall.

Finally, it is also election season, and although most of the noise is centered on the race for the White House, we have some white hot races here in Kansas. Primary day is on August 2, and we will have some of the most competitive primary races we have seen across the state in decades.

This year almost 20% of the Kansas Senate retired or decided not seek reelection. This includes the Senate Agriculture Committee Chair Senator Garrett Love from Montezuma.

House Agriculture Committee Chair, Representative Sharon Schwartz also decided not to seek reelection. Based on how things are going, it will be a very different group of legislators in Topeka when we start up again next January.

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2016 Loan Deficiency Payments Now In Effect 2016 LDP Updates from Kansas Farm Service Agency

Beneficial interest is lost, according to acceptable production evidence submitted to the county office, OR

USDA Farm Service Agency sent this bulletin at 07/06/2016 05:29 PM EDT

Of delivery, if producer requests the date-of-delivery option on Form CCC-633EZ (page 2) before delivery

A

s cash commodity prices have dropped recently, producers have been watching for LDP’s to go into effect, which happened this week. Loan Deficiency Payments (LDP’s) were first utilized in the 1990’s as a way to provide commodity producers price protection up to the USDA-established commodity loan rate without obtaining a grain commodity Marketing Assistance Loan (MAL). The 2014 Farm Bill re-authorized LDP’s and MAL’s.

To be eligible for LDP’s, producers must file FSA Form CCC-633EZ (page 1) with their FSA county office BEFORE losing beneficial interest in the commodity. Form CCC-633EZ can be found here: Form CCC633EZ (page 1) The LDP payment rate will be the rate in effect on the date: Of the request, if beneficial interest is still maintained on the date of the request, OR

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Beneficial interest is defined as having both CONTROL and TITLE to the commodity. Control of the commodity means the producer retains the ability to make all decisions affecting the commodity, including movement, sale and request for LDP. Title to the commodity means the producer has not sold or delivered the commodity or warehouse receipt to the buyer. Commodity acreage and individual producer shares are required to have been timely reported to FSA on Form FSA-578. Producers also must also be in compliance with the following rules:

• Actively Engaged The above requirements also apply to Marketing Assistance Loans.

LDP rates are determined by the amount the applicable commodity loan rate exceeds the CCCdetermined value, which is the lesser of either: 30-calendar day Posted County Price (PCP) Alternative PCP, which is a 5-calendar day rolling average.

• Conservation Compliance

Both the 30-day and 5-day PCP rates are calculated using a “moving average” over the number of days, using two terminal markets and location differentials for each county. LDP rates are in effect until the next business day, 7:00am EST. To check your county’s daily LDP rates online, use Daily LDP Rates. For assistance or more information, contact your local County FSA Office here, and review the LDP Fact Sheet.

• Foreign Person

Questions?

• Controlled Substance

Please contact your local FSA Office.

• Delinquent Federal Nontax Debt • Adjusted Gross Income

Italian Garlic Bread Burgers Celebrate National Burger Day on August 27!

Ingredients 1 1⁄2 pounds extra lean ground beef 1 package (11.75 ounces) frozen Mozzarella Garlic Cheese bread 6 tomato slices 18 large fresh basil leaves Salt and black pepper, to taste

Directions 1. Lightly shape ground beef into six patties. Preheat grill to medium heat. Place patties on the grill. Grill, uncovered, 13 to 15 minutes to medium (160°F) doneness, turning occasionally.

3. Cut bread crosswise into six “buns.”

Place burgers in buns; season to taste with salt and pepper. Top burgers with tomato slices and basil leaves.

2. Heat bread according to package directions for grilling or about 1 minute with crust side down on grate of grill.

Watch so that bread does not burn on bottom.

Note: If Mozzarella Garlic Cheese bread is not available, substitute regular garlic bread; 2 minutes before burgers are done, top each with mozzarella cheese slice.

Nutrition Information Makes 6 servings.

307 calories; 27 g protein; 24 g carbohydrate; 11 g fat (4.4 g saturated), 62 mg cholesterol; 4 mg iron; 3 g dietary fiber; 14 mcg folate and 303 mg sodium.

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July 2016

STAKEHOLDER NEWS BRIEF Moving the Mission July has once again proved to be one of our busiest months of the year with the constant flow of participants through the IGP Institute Conference Center doors.

Early in the month, Carlos Campabadal hosted 38 participants from nine different countries for the annual Feed Manufacturing course. Carlos continued to keep us busy with two courses the final week of July; Regional Agricultural Production Course (RAPCO) Poultry Nutrition and the USSEC (U.S. Soybean Export Council) Japan Soybean Meal Feed and Poultry Nutrition Training Program. On the distance education front, our team along with our GEAPS partners continue to deliver impressive numbers with 110 participants in four courses for the month of July.

Kelly Hannigan

In addition, our curriculum managers have been on the road furthering the IGP Institute mission efforts. Jay O’Neil was a featured speaker at the USSEC U.S. Soy Business Mission Workshop in Yangon, Myanmar as well as a risk management workshop for USSEC in Hangzhou, China.

Jay finished the month by attending the USGC (U.S. Grains Council) Summer Board of Delegates meeting in

In the Spotlight • Senior Formulator, Cargill Premix and Nutrition • Resident of Guadalajara, Mexico

Veronica Gomora

• Participant in the RAPCO Poultry Nutrition Course “I think it is really important for people to learn more. IGP gives us the chance to learn and gain more knowledge.”

Louisville, Kentucky and attending the Kansas Soybean Board meeting hosted in the IGP building. Carlos also found time between his courses to visit the Nestle Purina facilities in Saint Joseph, Missouri; attend the American Society of Agricultural and Biological Engineers annual meeting in Orlando, Florida; and join the Symposium on Mechanization and Postharvest Opportunities for Smallholders in Sustainable Agriculture in ChampaignUrbana, Illinois. Our Interim Associate Director, Brandi Miller, also attended U.S. Wheat’s summer board meeting in Fargo, North Dakota.

Finally, we are happy to announce Shawn Thiele has been hired to serve as the flour milling and grain processing curriculum manager. For more details, please see the article on the back page. I am thankful to work with the outstanding staff and faculty at IGP. It really takes a strong team to successfully conduct these courses and we are fortunate to have the talent and enthusiasm it takes to skillfully execute these world-class trainings.

Sincerely,

Kelly Hannigan Program Services Coordinator

Trainings and Activities Courses and activities held in July.

• IGP–KSU Feed Manufacturing Course • U.S. Soybean Export Council Japan Soybean Meal Feed and Poultry Nutrition Training Program • RAPCO Poultry Nutrition Course • GEAPS 500: Intro to Grain Operations • GEAPS 545: Grain Entrapment • GEAPS 541: Developing an Effective Safety Culture at your Company • IGP Rendering Code of Practice 201

1980 Kimball Avenue, 102 IGP Institute Conference Center | Manhattan, KS 66506–7000 | Tel. 785-532-4070 | Fax 785-532-6080 | www.grains.k-state.edu/igp | igp@ksu.edu

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Where in the World A monthly look at where we’ve been as we make our way around the globe promoting U.S. commodities and IGP Institute training opportunities.

• Spoke at U.S. Soybean Export Council (USSEC) U.S. Soy Business Mission Workshop in Yangon, Myanmar.

• Helped conduct a risk management workshop for USSEC in Hangzhou, China.

• Attended the U.S. Grains Council Summer Board of Delegates Meeting in Louisville, Kentucky.

• Present at U.S. Wheat’s summer board meeting in Fargo, North Dakota.

• Visited Nestle Purina in St. Joseph, Missouri.

• Attended the American Society of Agricultural and Biological Engineers Annual Meeting in Orlando, Florida.

• Visited the Symposium on Mechanization and Postharvest Opportunities for Smallholders in Sustainable Agriculture organized by the ADM Institute on Postharvest Loss.

Welcome Shawn Thiele Shawn has worked in the milling industry for 11 years. He has spent the last four years working as the milling operations manager at the KSU Hal Ross Flour Mill in Manhattan, Kansas.

Prior to his time at Kansas State, he Shawn Thiele worked seven years at Quaker Oats in Cedar Rapids, Iowa as oat and corn mill front line leader, milling bulk and elevators process improvement engineer and assistant manager of milling operations.

As the flour milling and grain processing curriculum manager, Shawn will teach the core milling and processing courses at the IGP Institute, as well as develop and present workshops, courses, distance education courses, and other technical outreach programs to enhance the market promotion, consumption and utilization of U.S. cereal grains, oilseeds and their value-added products for the global grain and feed industry.

Lance Rezac gives a tour of his soybean field near Belvue, Kansas to USSEC Japan Soybean Meal Feed and Poultry Nutrition Training Program participants Yoshinor Hashizawa, Yuya Wada, Yasuo Sakurai, Jun Shiraogawa and Takahiro Morimoto.

Rave Reviews “What I’ve been telling my workers for the past year and have been trying to educate, train and get them to understand has been reinforced here by what I consider to be the true experts. Now they will be able to be disciples on what they’ve learned with other people in our feed group.”

– Steve Trachsel, Manager of Production, Cherkizovo Feed, Lipetsk, Russia IGP–KSU Feed Manufacturing participant

“The ideas taught at the IGP Institute help us know how to make our feed more efficiently.”

– Takamasa Ijichi, Executive Director, AXYZ, Kagoshima, Japan USSEC Japan Poultry Course

“The courses at IGP improve every year. There have been a lot of improvement since the first seminar we conducted together, they are improving all the time. It is really easy for me and other officers to organize seminars here.”

– Nayeli Vilanova, Regional Marketing Director, USSEC, Guadalajara, Mexico RAPCO Poultry Nutrition Course

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News from : NAWG Weekly Updates June 7, 2016 Chandler Goule Starts at NAWG New NAWG CEO Chandler Goule began his tenure at NAWG with July 5 as his first day. Since finishing at National Farmers Union, where he was Senior Vice President of Programs, Chandler took a well-deserved vacation before diving in at NAWG to start his work in developing and maintaining industry relations, acting as Executive Director of the National Wheat Foundation, and leading NAWG’s advocacy for wheat growers. The NAWG office and board are excited to start working with Chandler and are glad to welcome him to the team.

NAWG Seeks Competitive Growers Innovation and efficiency, it’s the future! For the first time in 20 years NAWG is putting on the National Wheat Yield Contest and is encouraging the nation’s producers to sign up online by the spring wheat sector deadline of August 1. The goals of this 10Rediscover RediscoverWH WH E AT| AUGUST | AUGUST 2016 10 E AT 2016

national contest are raising public interest within the industry, as well as encouraging producers to spread new methodologies and technologies for achieving maximally yielding results. The contest will also help to ensure a high quality supply of wheat to meet domestic and international demands. Entries for the spring wheat sector are due August 1 and the winner will be announced in the fall of 2016 and given the opportunity to attend the 2017 Commodity Classic in San Antonio, Texas as the guest of the National Wheat Foundation.

Sign up at https://yieldcontest. wheatfoundation.org/ House Deals With Cuba Amendments to Financial Services Appropriations Bill This week, the House of Representatives considered the FY 2017 Financial Services Appropriations bill. Consideration was scheduled for earlier in June but was delayed due to the Democratic-Republican conflict over gun control regulations.

During consideration this week,

there was an amendment from Rep. Rick Crawford (R-AR) that was made in order that would lift the current financing restrictions which prohibit the United States from financing agricultural product sales to Cuba. Cuba is a very relevant target market for the wheat industry, with an average of 30 million bushels imported annually, making the country the largest market in the Caribbean for wheat.

During consideration, Rep. Crawford pulled the amendment from floor consideration after an informal agreement was reached whereby the primary opponents of expanding trade with Cuba in the House would work with Rep. Crawford and other proponents on finding a path forward for authorizing legislation that would ease the financing restrictions.

NAWG is highly supportive of efforts to liberalize trade with Cuba, and believes that doing so will allow the United States to take advantage of our ideal geographical location to Cuba.

Moving forward, NAWG will continue to work with other members of the U.S. Ag Coalition for Cuba and our champions on the Hill, to move the needle on the Cuba trade relations debate.

Senate Gears Up for Their Final GMO Vote Following the cloture vote yesterday, the U.S. Senate is expected to vote tonight on the GMO labeling agreement that has come forth from Senate Agricultural Committee Chairman Pat Roberts and Ranking Member Debbie Stabenow. Yesterday the Senate took a cloture vote that ended in support by a 65-32 vote.

Today’s final vote also needs 60 votes to pass.This proposal will allow various options to label biotech on consumer products.

This legislation will ensure that safe and affordable technologies like biotech are protected from stigmatization from vilifying symbols. The Vermont law would allow for the development of other state labeling laws, resulting in a patchwork of inefficient and costly state laws that would increase costs for producers and consumers alike. The RobertsStabenow agreement will provide consumers with the information that they want about their food, while protecting their interests as consumers and ensuring that they will have safe and affordable food. Because of this, it is very important Senators hear what farmers are telling them, and vote to protect producers. Please contact your members, and urge others to do the same, and voice your opinion in support of this bill.

NAWG Supports Senator’s Letter to EPA Regarding RFS Proposed Rule In reaction to the Environmental Protection Agency’s (EPA) proposed rule setting blending targets under the Renewable Fuel Standard (RFS) for 2017, 39 Senators signed a letter to the EPA, urging them to protect the U.S. biofuel sector and economic opportunities by setting the blending targets at levels set by Congress. The RFS adopted in 2005, and expanded in 2007, was meant to implement a stable policy to promote innovation and investment in renewable fuels that will maximize biorefining capacity and distribution infrastructure to ensure access to biofuels for American consumers. This policy has since then produced hundreds of millions of dollars of investment in biofuels, leading to expanded production capacity of biofuels, the creation of hundreds of thousands of jobs, the reduction of the environmental impact of the transportation and energy sectors, and benefit to the agriculture economy.

The EPA now has proposed to reduce the 2017 Renewable Volume Obligation (RVO) under the RFS, which would send the wrong market signals and impact agricultural markets and investment in new technology, as well as cellulosic biofuels production. It is imperative that continued investment in biofuels is prioritized, as rural, agricultural communities will be impacted the hardest by a reduction in the proposed RVO. NAWG supports the RFS the way Congress passed it, and opposes the EPA’s proposed reduction. NAWG urges the

EPA to thoroughly review the proposed 2017 RVO requirements and maintain the RFS as passed

by Congress. EPA is accepting public comments on the 2017 RVO proposal through Monday, July 11.

House Votes to Pass Global Food Security Act, Now On to President’s Desk The House voted overwhelmingly (369-53) to pass the Global Food Security Act, which will authorize a $1 billiona-year global program, known as Feed the Future, to address poverty and hunger by aiding farmers in poor countries. The Act passed the Senate in April, and has now garnered bipartisan support in the House. This development initiative will help continue to increase economic growth in countries with poor infrastructure to facilitate food security, and ensure that farmers in developing countries have the tools necessary to achieve selfsufficiency through agricultural development. The Act will require the administration to develop a whole-of-government plan for addressing food insecurity, while emphasizing agricultural development in rural communities. The Act will also secure the Emergency Food Security Program, which will be authorized to respond to emergency food needs of communities challenged by natural or manmade disasters, without threatening the food aid programs authorized by the farm bill, such as Food for Peace.

Following this vote in the House, the Act will go on to President Obama’s desk where it’s expected he will sign it into law.

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NAWG Hires Summer Intern Michael Granche Along with welcoming their new CEO, NAWG also welcomed their summer intern Michael Granché!

Michael is a rising junior at Virginia Tech studying Applied Agricultural Economics as well as Animal Science. He serves as a student ambassador for the College of Agriculture and Life Sciences at his university. Michael is from Catlett, Virginia where he grew up on his family’s small beef farm; his hobbies include playing guitar and riding his unicycle. He is very excited to be on the NAWG team this summer and will be working alongside NAWG staff to gain experience in advocating for farmers through policy development and communications. His responsibilities vary from assisting with regular communications projects, and helping the policy department prepare for the Farm Bill by completing research and attending congressional hearings.

July 14, 2016 Low Prices Trigger Loan Rates in Some Areas With Hard Red Winter wheat harvest wrapping up in the southern plains and in full force moving north, low harvesttime prices have triggered the availability of marketing assistance loans (MALs) and loan deficiency payments (LDPs) for the first time in several years. MALs are available to producers at harvest time and intended to provide interim financing for farmer to help them meet cashflow needs without having to sell their commodities.

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Farmers can then delay selling the commodity until market conditions improve. In using a MAL, a farmer can repay the loan at less than the loan rate (plus accrued interest). A farmer could also get an LDP in lieu of securing a MAL. Rates change daily; farmers can check rates at their county FSA office or by visiting http://www.fsa.usda.gov/ programs-and-services/pricesupport/Index.

Note, in order to be eligible for MALs and LDPs, a farmer must retain beneficial interest in the commodity, which requires both the farmer’s control of the commodity as well as title to the commodity. A farmer should fill out a form from FSA specifying they retain beneficial interest even before they seek an MAL or LDP. Additionally, it should be noted that if the MAL is repaid at less than the loan principal, that difference is called a marketing loan gain (MLG), which is subject to the aggregate $125,000 payment limit (ARC, PLC, and marketing loan gains are all combined into one single payment limit) and Adjusted Gross Income limitations. A farmer also has the option of purchasing a Commodity Certificate which they can exchange for the outstanding loan collateral instead of forfeiting that loan collateral. Gains realized through the use of a Commodity Certificate are not subject to the payment limitation. More information can be found in this FSA fact sheet at http://www. fsa.usda.gov/Assets/USDA-FSAPublic/usdafiles/FactSheets/2016/ commodity_certificate_exchange_ Feb2016.pdf

Record Wheat Harvest Nation Wide, Farmers Urged to Enter Yield Contest All across the United States, farmers are reporting record wheat yields. A recent NASS report indicates that the 2016 winter wheat crop is forecasted at 1.63 billion bushels, up 8 percent from the June 1 forecast and up 19 percent from production in 2015. The same report predicts yields of 53.9 bushels per acre, which would be up 3.4 bushels from the June prediction and up 11.4 bushels from last year’s production. These high yields are a testament to farmer utilization of new methodologies, improved weather conditions, and the safety net provided through Title programs and crop insurance.

With these high yields, NAWG is strongly encouraging producers to show off their hard work and enter in the National Wheat Yield Contest that is being sponsored by the National Wheat Foundation. The deadline for entering is August 1, and you can apply easily at https://yieldcontest. wheatfoundation.org/ EPA-Interior Department Appropriations Bill Passed by the House Floor The U.S. House approved legislation funding the Department of the Interior, the Environmental Protection Agency (EPA), and other related agencies, providing a total of $32 billion, which is $64 million below the FY16 enacted level and $1 billion below the President’s request. The EPA’s funding is provided at $7.98 billion, which is $165 million below FY16 enacted level and $291 million below the President’s request. Included in this bill is

a prohibition implementing the Administration’s recent changes to the definition of waters of the U.S. under the “Clean Water Act”.

The bill also delays changes to the listing status of the sage grouse under the Endangered Species Act. During floor consideration, the House passed an amendment to raise the threshold for farm oil storage that is subject to Spill Prevention, Control and Countermeasure (SPCC) requirements. The provision would increase the single aboveground container storage to 10,000 gallons and increase the aggregate level to 42,000 gallons.

NAWG supports the inclusion of these policy provisions in the annual funding bill.

Scientists Unravel Durum Wheat Genome Sequence A research network of scientists from several research organizations such as the Council for Agricultural Research and Economics (CREA), the National Research Council of Italy (CNR), and Montana State University have announced the assembly of the durum wheat genome, the source of semolina, which is the key ingredient in pasta. Under the leadership of Dr. Luigi Cattivelli of the Italian CREA and several other international scientists, the collaborative network, funded by the several of the organizations, has worked with NRGene and Genomix4life to utilize software to produce a complete referential analysis of the genome. With an exponentially growing population, pasta is a food staple of the world for every culture.

With the ability to locate precise genes and regulatory elements of the genome, researchers will be

provided with invaluable tools and opportunities for wheat breeders.

“It’s critical to select new durum cultivars with greater yield potential as well as enhanced quality and nutritional properties,” said Dr. Luigi Cattivelli, who lead the research efforts of the international team.

Now that the entire genome of the durum variety has been genetically mapped out, scientist will be able to identify and select new cultivars to improve the quality and yield of the crop for future harvest. NAWG supports the groundbreaking research efforts that were made and firmly believes that this is a step towards more sustainable varieties of wheat in an attempt at global food security.

NAWG Submits Official Comments to EPA Regarding RFS Proposed Rule In reaction to the Environmental Protection Agency’s (EPA) proposed rule setting blending targets under the Renewable Fuel Standard (RFS) for 2017, NAWG submitted official commentary on July 11, 2016. In commenting on the proposal, NAWG reiterates its support for the levels set

by Congress and urges the EPA to follow the levels set by Congress. The RFS was adopted in 2005, and expanded in 2007, and was meant to implement a stable policy to promote innovation and investment in renewable fuels that will maximize biorefining capacity and distribution infrastructure to ensure access to biofuels for American consumers. This policy has since then produced hundreds of millions of dollars of

investment in biofuels, leading to expanded production capacity of biofuels, the creation of hundreds of thousands of jobs, the reduction of the environmental impact of the transportation and energy sectors and benefit to the agriculture economy.

The EPA now has proposed to reduce the 2017 Renewable Volume Obligation (RVO) under the RFS, which would send the wrong market signals and impact agricultural markets and investment in new technology, as well as cellulosic biofuels production. It is imperative that continued investment in biofuels is prioritized, as rural, agricultural communities will be impacted the hardest by a reduction in the proposed RVO. NAWG supports the RFS the way Congress originally passed it, and opposes the EPA’s proposed reduction. NAWG feels that altering the RFS would negatively impact future investments in the next generation of biofuels.

In addition to the threat that future investments in biofuels could potentially decline due to changes in the RVO, indicating that the RFS is not a priority and a consistent requirement could make investors wary to committing funds to alternative resources. NAWG believes that setting the RVO levels in accordance with Congressional ruling will ensure access to and investment in renewable fuels.

July 21, 2016 National Wheat Foundation Celebrates Legacy and Building Thirty-eight years ago, National Association of Wheat Growers (NAWG) President Glenn Moore Rediscover E AT 2016 RediscoverWH WH E AT| AUGUST | AUGUST 201613 13

was nearing the end of his tenure when he realized that the way to ensure NAWG’s continuing influence as a commodity organization in Washington, D.C. was to purchase a building and build NAWG’s visibility.

NAWG and the National Wheat Foundation (NWF) celebrate the paying off of the mortgage on the building purchased nearly forty years ago. Moore’s inspiring vision for the future of NAWG and NWF led to the investment in the building, and his huge bargain has manifested itself in wheat’s stable position as the third largest commodity in the country with an ambitious and active agenda.

"This was a historic week for the National Wheat Foundation and National Association of Wheat Growers. Nearly forty years ago, Glen Moore had the vision for the future of the wheat industry, which included solidifying a presence on Capitol Hill," said NWF Chairman Phil McLain. "It was an honor to be joined by him this week during our Foundation’s board meeting and to hear about the important history of NAWG and the Wheat building."

At the end of President Moore’s time with NAWG in 1978, his priority was to increase NAWG’s public presence with a permanent home in the city, and after consulting with the state organizations, and some minor setbacks, NAWG and NWF settled on 2nd Street in Capitol Hill to continue their advocacy work for wheat growers across the country.

With the Foundation newly created, a project was needed to bolster public attention for the new organization, and they 14Rediscover RediscoverWH WH | AUGUST 2016 14 E EATAT| AUGUST 2016

began working with universities and private industries to promote and continue important research for wheat. With DuPont, Union Carbide, and the Rockefeller Foundation involved in the National Wheat Foundation’s agenda, NAWG and NWF were considered to be the most influential commodity organization in Washington, D.C. Their work is now continued in the areas of trade policy, environmental regulation, research and technology, and the industry projects of the National Wheat Foundation. With the backing of the National Wheat Foundation, NAWG is positioning itself to go into the creation of the next Farm Bill with the needs and priorities of U.S. wheat growers at the forefront of its drive to protect wheat growers and provide them with the tools to continue wheat’s legacy as an influential and successful commodity.

NAWG, NWF Attend USW Summer Conference During U.S. Wheat Associates' summer board meeting in Fargo, ND, the National Wheat Foundation held a meeting to discuss the FY 2017 budget and on-going Foundation projects, as well as to celebrate paying off the mortgage on the Wheat building in Washington, DC (see related story). NAWG also participated in joint NAWG/USW policy committee meetings to discuss international trade, biotechnology, and food aid.

During the USW full board meeting, participants heard from a number of speakers, including North Dakota Lieutenant Governor Drew Wrigley, ND Agriculture Commissioner Doug

Goehring, and the president of the North Dakota Mill, among others.

Additionally, there was a panel discussion about current efforts to open agricultural trade with Cuba; panelists included Senator Heidi Heitkamp's (D-ND) legislative assistant, Tyler Jameson; USW's regional vice president in their Mexico office, Mitch Skalicky; and USW's deputy policy director, Ben Conner.

Joint International Trade Policy Committee The JITPC met and discussed the current status of USW's study showing that China's domestic support programs are costing U.S. wheat farmers around $650 million a year in lost revenue, Canadian grain grading issues, federal funding for the Market Access Program (MAP) and Foreign Market Development (FMD) program, and the status of Congressional attention to the Trans-Pacific Partnership (TPP), among other issues.

Joint Biotechnology Committee In the JBC meeting members and the audience listened to an in-depth presentation from Dr. Jim Radtke with CIBUS on new breeding techniques and research the company is focused on, and how they may relate to wheat research. The JBC also heard updates from companies, on the GMO labeling bill and on the most recent Advisory Committee on Biotechnology and 21st Century Agriculture (AC21) meeting.

President Obama Signs Global Food Security Act into Law After the House passed the Global Food Security Act earlier in July, the bill went to President Obama’s desk, where he signed it into law. The $1 billion-a-year global program, known as Feed the Future, will provide support to farmers in developing countries by supplying them with the tools, education, and programs for facilitating economic and agricultural growth in their countries. The Act passed the Senate in April, garnering bipartisan support in the House before passing overwhelmingly in support.

By signing this bill into law, President Obama demonstrates the U.S.’s desire to help developing farmers achieve self-sufficiency in agricultural development, contributing to a global progress towards food security and emphasizing development in rural communities. This Act will also secure the Emergency Food Security Program, which will respond to emergency food needs of communities, while still protecting the food aid programs authorized by the Farm Bill. NAWG applauds President Obama’s actions in protecting the future of farmers in developing countries, while prioritizing the urgent need for global food security.

Lesser Prairie-Chicken Removed from Endangered Species List, But Still Under Review The Fish and Wildlife Service (FWS) posted in the Federal Register action to de-register the lesser prairie-chicken as a threatened species under the

Endangered Species Act of 1973 (ESA). The action was effective immediately. The action by the agency was in response to a 2015 court order vacating the FWS decision to place the bird on the Federal List of Threatened and Endangered Species. In a statement, the agency said “This administrative action and the decision not to appeal the court’s ruling do not constitute a biological determination on whether or not the lesser prairie-chicken warrants federal protection. The Service is undertaking a thorough reevaluation of the bird’s status and the threats it faces using the best available scientific information to determine anew whether listing under the ESA is warranted."

Monarch Collaborative Conference Set for Next Month The Monarch Collaborative is holding a meeting in St. Louis next month to bring together individuals in agriculture, conservation, resource management and research communities to foster and enhance partnership opportunities to increase monarch habitat on the agricultural and rural landscapes.

NAWG is a member of the Monarch Collaborative along with other national organizations representing farmers, ranchers, and land owners; businesses working along the agricultural supply chain; researchers and academic institutions; federal and state entities; and conservation organizations. The group supports productive agriculture and livestock operations in concert with monarch conservation. An increase in milkweed and nectar plants appropriately placed in

rural areas can benefit monarchs without inhibiting production.

There is not a registration fee to participate at the conference, but to register and for more details, contact Suzan Klein at the Keystone Policy Center (sklein@keystone.org). Additional materials on the Monarch Collaborative can be found at https://www.keystone.org/ our-work/agriculture/monarchcollaborative/.

July, 28 2016 National Wheat Yield Contest Deadline is AUGUST 1 NAWG is still encouraging and accepting applications for the National Wheat Yield Contest!

Producers can sign at https:// yieldcontest.wheatfoundation. org/ by the spring wheat sector deadline of AUGUST 1. This national contest is intended to raise public interest in the wheat industry as well as encourage producers to converse amongst themselves about technologies and more efficient methodologies that will benefit the community as a whole. The winner will be announced in the fall and given the opportunity to attend the Commodity Classic in San Antonio, Texas as the guest of NWF. NAWG Endorses Newcomer Dr. Marshall for Kansas’ First District U.S. Representative NAWG endorsed Dr. Roger Marshall for the U.S. House of Representatives from the First district of Kansas. As a native Kansan, Marshall values the hard work of farmers, the importance of protecting crop insurance and the farm economy, and projecting Rediscover E AT 2016 15 RediscoverWH WH E AT| AUGUST | AUGUST 2016 15

the voices of Kansas farmers into DC, where Kansas has not had representation on the House Agriculture Committee for four years.

“As a Kansas wheat farmer, and a constituent of Marshall’s district, it is important to me that there is someone who I can trust in Washington to advocate for my needs, and the needs of other farmers,” said David Schemm, NAWG Vice President. “We took this extraordinary step because in witnessing Dr. Marshall’s willingness to engage with Kansas wheat farmers and continue the legacy of the First district’s values and integrity by representing us in Washington, we are confident that Dr. Marshall stands with, and for, wheat farmers.”

NAWG’s endorsement of Dr. Roger Marshall is intended to speak to his dedication to giving Kansas wheat farmers a voice in Washington. NAWG is confident that Marshall will use his experience and Kansas upbringing to fight for wheat farmers in the upcoming Farm Bill.

Vice President Schemm also contributed an editorial to High Plains Journal.

NAWG Vice President Schemm Speaks with Media at Ag Media Summit This week, NAWG Vice President and Kansas wheat grower David Schemm attended the Agriculture Media Summit event in St. Louis, MO, where he spoke to representatives of the media about issues as diverse as all-time high wheat crop yields, Farm Bill implementation and planning, and recent developments in the Natural 16Rediscover RediscoverWH WHEEAT AT| AUGUST | AUGUST 2016 16 2016

Resources Conservation Services (NRCS) of the USDA. With nearly 500 participants and several of the largest media publications represented, this year’s event allowed Schemm an opportunity to discuss what is most important to wheat farmers heading into the next Farm Bill.

In speaking with media spokespeople, Schemm emphasized the importance of the Trans-Pacific Partnership and our current trading partners, especially given the size of this year’s wheat harvest. NAWG hopes that these high levels will incentivize sophisticated trade relationships benefiting American wheat farmers, and reiterate the importance of maintaining safety net programs in the next Farm Bill. In discussing how low prices are triggering Marketing Assistance Loans (MAL) and Loan Deficiency Payments (LDP) by the Farm Service Agency (FSA), Schemm spoke to the importance of protecting farmers against the possibility of continued low prices by prioritizing the development of a workable, flexible, and feasible farm safety net in the next Farm Bill. Schemm emphasized that it is crucial that programs like crop insurance, ARC, PLC, and loan rates are maintained to combat low prices that are outside of the farmers’ control. Schemm also spoke with representatives from NRCS about the redesign of the Conservation Stewardship Program (CSP) to become better integrated with other NRCS programs, while accommodating local priorities, stating how important it is that wheat farmers utilize CSP to protect natural resources without detriment to crop yields and productivity.

RMA Works to Lower Improper Payment Rate, While Highlighting Effectiveness of Crop Insurance The federal crop insurance program is proving to be financially effective and productive, but the Risk Management Agency (RMA) is still looking for ways to improve, including reducing its already very low improper payment rate. In a meeting with reporters, RMA Administrator Brandon Willis stated that although the improper payment rate for Fiscal Year 2015 was 2.2 percent, which is down significantly from the FY 2014 rate of 5.58 percent and almost half of the 4.39 percent rate for all government programs, the agency is expanding its use of “data mining” and spot-checks of crop insurance agents and adjustors to help identify improper payments.

Administrator Willis also discussed the recent growth in the program, as measured by coverage options. Specifically, the crop insurance program has doubled from 2009 to 2016, with an increase of 64,000 coverage options to 118,000 options covering 543 varieties of crops. Liability through the program also increased from $79.5 billion in 2009 to $102.4 billion today, according to RMA figures. Wheat, at $8.4 billion, comprises 8.2 percent of that total. Earlier in July, RMA also stated in a press release that other programs included in the 2014 Farm Bill, such as Supplemental Coverage Option and the APHS Yield Exclusion have been successful in helping farmers expand protection of their crops.

The RMA’s expansion of these programs has led to a reliable

farm safety net keeping producers strong and protected.

ARC and PLC Deadline is August 1, Enroll Now NAWG wants to remind all state producers that this coming Monday, August 1, is the deadline to enroll in the Agriculture Risk Coverage and Price Loss Coverage Programs through USDA’s Farm Service Agency (FSA) for the 2016 crop year. Though producers have previously elected the

program in which they’ve chosen to participate, they still must enroll in that program annually.

Created in the 2014 Farm Bill, these programs are intended to benefit participating producers when they experience revenue losses or price declines. An estimated 1.76 million producers are expected to be signing ARC or PLC contracts for their protection this year. Commodity producers of wheat, sunflower seed, soybeans, sesame, safflower

seed, medium and long grain rice, rapeseed, dry peas, peanuts, oats, mustard seed, lentils, grain sorghum, flaxseed, crambe, corn, large and small chickpeas, canola, and barley are all covered under ARC and PLC contracts. More information about programs and how to enroll can be found on the USDA website at http://www.fsa. usda.gov/.

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News from : July 14, 2016 U.S. Wheat Exports Start 2016/17 Fairly Strong

By Stephanie Bryant-Erdmann, USW Market Analyst U.S. commercial sales for marketing year 2016/17, which began June 1, are off to a welcome start. As of July 7, U.S. wheat export sales for all classes totaled 8.78 MMT, up 35 percent from export sales on the same date in 2015/16. USDA now expects 2016/17 exports to total 25.2 MMT, up 19 percent from 2015/16, noting that this would be the highest volume in three years.

USDA reported hard red winter (HRW) year-to-date exports at 3.29 MMT, up 86 percent from the prior year. Significantly higher demand from Brazil is expected this year after rain delayed harvest and damaged wheat quality in both Brazil and Argentina, normally Brazil’s top supplier.

As of July 7, HRW sales to Brazil totaled 232,000 MT, more than double the volume to Brazil at the same time last year. Sales to Mexico are also up 81 percent year over year due to more competitive pricing. To date, Chilean and Peruvian HRW sales are already 18 E AT 2016 18Rediscover RediscoverWH WH E AT| AUGUST | AUGUST 2016

greater than total 2015/16 HRW sales.

Sales of soft red winter (SRW) for 2016/17 are down 35 percent year over year at 827,000 MT, due in part to smaller carry-in stocks of milling quality SRW and early market perceptions about a recurrence of quality issues in this year’s crop. However, with nearly half of the 2016/17 SRW production safely in the bin, quality looks much improved.

Sales to some Latin American countries, including Honduras, El Salvador and Costa Rica are slightly ahead of last year’s pace.

Hard red spring (HRS) sales of 3.02 MMT are up 53 percent year over year. As of July 7, buyers in the Philippines purchased 437,000 MT, nearly double their volume last year at the same time. The Philippines is the top HRS buyer, and sales to eight of the top ten HRS customers are also ahead of last year’s pace. Sales to the European Union (EU) of 157,000 MT are nearly triple last year’s sales on the same date. Year to date sales to Venezuela of 145,000 MT are nearly equal to total 2015/16 HRS sales.

As of July 7, exports of soft white (SW) wheat are up 27 percent year over year at 1.51 MMT. Sales

to the top three SW customers — Philippines, Japan and South Korea — are all ahead of 2015/16 pace. U.S. SW sales to Thailand and Indonesia are also up. Yearto-date, Indonesia has purchased 110,000 MT, up from 42,000 MT on the same date in 2015/16.

Thailand sales are up 57 percent year over year at 74,000 MT. High prices continue to constrain durum exports. Year to date durum exports total 128,000 MT, down 54 percent from the same time last year. To date, Nigeria, the EU, Guatemala and Panama are the top durum buyers.

A significant portion of these 2016/17 sales are designated as “sales to unknown designations.”

The U.S. Wheat Industry Helps Celebrate 100 Years of Grain Standards On July 12, USW Chairman Brian O’Toole and National Association of Wheat Growers (NAWG) President Gordon Stoner sent a letter of congratulations to USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) on the 100th anniversary of the U.S. Grain Standards Act of 1916 (USGSA). Chairman O’Toole and President Stoner also told GIPSA Administrator Larry Mitchell that the remarkable

benefits from the USGSA to the U.S. grain supply chain and its customers is worthy of an official proclamation from the U.S. Congress recognizing the Act and this important milestone.

The USGSA was a landmark law that helped resolve chaotic and inefficient marketing conditions and increase the trust in U.S. agricultural commodities. U.S. grain standards for wheat were established under the Act in 1917.

Then, when fraud in the system again threatened the credibility of the U.S. grain marketing system, Congress amended the Act in 1976 to establish official weighing services, record keeping by elevators, registration of grain exporters, and user fees to cover federal supervision costs.

Importantly, that amendment established the Federal Grain Inspection Service (FGIS) and required either federal or state agency inspections for export.

“It would be nearly impossible to calculate the value of the USGSA and the FGIS to America’s wheat farmers and their customers,” O’Toole and Stoner noted. “Today, the work FGIS does represents a critical component in U.S. wheat’s reputation as the world’s most reliable supply. With half of the wheat that U.S. farmers produce every year available for export, inspection helps increase the value of that wheat to overseas customers.

“When USW brings buyers to the United States, one of the first stops is almost always at an FGIS regional office or laboratory at an export elevator,” they added.

“Buyers around the world know that the wheat they tender for

from the United States is the wheat that will be loaded on the vessel. FGIS inspection logs give importers the data to extract the most value from their tenders.

If there is a discrepancy, buyers know that experienced workers at the National Grain Center in Kansas City, MO, have the samples needed to conduct another impartial inspection.”

O’Toole and Stoner went on to say that overseas buyers are more willing to purchase U.S. wheat because they have confidence that our industry, growers and grain grading system consistently deliver high value products.

The wheat leaders concluded: “On behalf of the wheat farmers USW and NAWG represent and their customers, we thank Congress, GIPSA, FGIS and the hundreds of individual grain inspectors across the country and we look forward to the next 100 years of collaboration as we grow and prosper together.”

Learn more about FGIS grain inspection here: http://blogs. usda.gov/2015/07/10/usda-graininspectors-work-to-upholdamericas-reputation-for-qualitysupport-new-markets/.

A Busy Season of Wheat Market Development Activities USW works steadily to share trade, market and technical information for the world’s wheat buyers. The first few months of marketing year 2016/17 (June to May) are proving to be a very busy time, including several faceto-face meeting opportunities for visiting trade teams, short courses and other activities, all funded by state wheat commissions

and export market development funding from USDA’s Foreign Agricultural Service (FAS).

In June, USW’s Sub-Saharan Africa regional office provided tuition for three milling managers to take the IAOM Executive Milling Course and sponsored eight millers at a Nigerian and South African Flour Millers Short Course at Kansas State University’s IGP Institute.

USW brings trade teams from around the world to the United States each summer to witness wheat harvest and get a firsthand look at the new crop’s initial quality. This June, Nigerian millers visited Texas, Kansas and North Dakota. In addition, USW Assistant Regional Vice President Joe Sowers traveled with four Philippine journalists to the Pacific Northwest and Washington, DC, to visit with farmers, discuss supply and quality with industry representatives and visit elevators and port facilities, as well as to meet with USDA and other U.S. government officials. To read more about that effort, visit http://www. mb.com.ph/ph-emerges-secondbiggest-buyer-of-us-wheat/.

A highlight in June was the very successful Latin American and Caribbean Buyers Conference in Portland, OR, with nearly 80 overseas buyers and industry representatives participating.

Read more about the conference at Wheat Buyers Conference Positions U.S. Wheat as an Exceptional Value. USW President Alan Tracy also traveled to London in June to give an update on world wheat market issues at the International Grains Council meeting.

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Early July saw a five-person Korean team of bakers participate in a whole wheat cookie and cracker short course at the Wheat Marketing Center (WMC) in Portland, OR. The bakers worked on developing whole wheat flourbased formulations using SW for biscuit items and product quality evaluation. A custom course on pasta production and technology for several customers from South America, Mexico and Africa at the Northern Crops Institute (NCI) in Fargo, ND, is set to begin July 18.

Starting July 30, NCI and USW will also host a workshop in which wheat buyers from South Asia will learn how to write tenders to get the most value possible from U.S. wheat purchases. At about the same time, beginning and advanced Asian noodle production courses for Nigerian customers start at the Wheat Marketing Center.

Customer visits continue in July and into August with six more trade teams from Colombia, Venezuela, Mexico, as well as two separate teams from Korea and a team from the growing market of Indonesia. Looking ahead to September, USW is planning a seminar for durum buyers to be held in Morocco.

The connections forged through visits and courses like these are the very foundation of past, present and future success for U.S. wheat farmers, industry stakeholders and overseas customers.

“Our visitors always say that building relationships with farmers and the people in the U.S. wheat export supply chain makes a difference in their jobs,” said USW Director of Programs and 20 E AT | AUGUST 2016 20Rediscover RediscoverWH WHE AT | AUGUST 2016

Planning Jennifer Sydney. “They get firsthand knowledge of the new crop and proof that the United States remains the world’s most reliable supplier of high quality wheat.”

New Food for Progress Funding Reflects Food Aid Benefits

By Elizabeth Westendorf, USW Policy Specialist Last week, USDA announced Food for Progress funding allocations for fiscal year 2016.

A total of $153.2 million in funding will go to projects in eight countries that USDA estimates will reach over 3.8 million beneficiaries.

Half of the countries on the list (Burkina Faso, Ethiopia, Malawi, and Mozambique) are in Africa, where this Food for Progress funding will not only enable development projects in these countries, but will also raise money for those projects by providing U.S. commodities for sale in the local markets. All four of these countries are experiencing severe droughts that have hurt domestic food production. The monetized commodities through Food for Progress supplement locally produced food supplies that are currently not sufficient to fully meet their populations’ needs. They also provide economic stimulus to encourage continued development that can lead to more resilience in future food crises.

Studies show a strong positive correlation between food insecurity and political instability.

When it seems like instability around the world is rising and there are more crises demanding U.S. foreign assistance, these food

aid programs are more important than ever.

The United States is the largest provider of food aid worldwide.

USAID funding has evolved to include new methods of reaching those in need, but U.S. wheat farmers believe traditional inkind food aid will always have a place in both emergency and developmental humanitarian aid programs. New emergency aid tools like local and regional procurement and cash vouchers supplement the foundational aid tool of in-kind food aid.

USW is committed to supporting programs that help feed food-insecure people. In a world with political uncertainty and increasingly volatile climate conditions, U.S. wheat farmers are proud that their product is going to benefit food-insecure populations through USDA and USAID emergency and developmental aid.

USW Farmer Directors to Meet in Fargo, ND At their annual meeting July 17 to 20, 2016, USW directors representing 18 state wheat commission member organizations will hold committee meetings, including two joint committees with the National Association of Wheat Growers (NAWG), and install officers for 2016/17 among other activities.

The board meets in Fargo, ND, this year, a site selected by outgoing Chairman Brian O’Toole of Crystal, ND. USW will share more information during and after the meeting.

Guest speakers at the joint board meeting include North

Dakota’s Lieutenant Governor Drew Wrigley, the Agriculture Commissioner of North Dakota, Doug Goehring, and President of The Money Farm, Mike Krueger.

The board will also hear an update on trade relations with Cuba from USW Regional Vice President Mitch Skalicky and Assistant Director of Policy Ben Conner. Farmers who participated in “board team” travel to Latin America and North Asia earlier this year will report on their experience.

One of the highlights will be a presentation by Vance Taylor, the President and General Manager of the North Dakota Mill and Elevator Association in Grand Forks, ND, the only state-owned milling facility in the United States. Over the years, the organization has worked cooperatively with state agencies in promoting North Dakota and its high quality products by participating with and hosting international trade teams, including wheat buyers, and serving as a resource center for training, research and testing.

The North Dakota Mill receives no funds or financial assistance from the State of North Dakota to subsidize the milling operations, but has contributed more than 50 percent of its profits to the North Dakota State General Fund for more than 35 years and continues to be a valuable asset to the State of North Dakota.

USW and Chairman O’Toole wish to thank these supporting sponsors: BNSF Railroad, Columbia Grain, North Dakota Mill and Elevator Association, Monsanto, Syngenta, AgCountry Farm Credit Services, Northern

Crops Institute, Dakota Growers Pasta Co., U.S. Durum Growers Association, Otto Ag, Dakota Specialty Milling and the conference host North Dakota Wheat Commission.

Wheat Industry News House Passes GMO Labeling Bill. "The Hill" reported today that a bill to create a federal labeling standard for foods with genetically modified ingredients passed in the U.S. House of Representatives and Pres. Obama is expected to sign the bill into law directing USDA to create a national labeling standard.

It allows food producers to choose how they want to disclose the presence of genetically modified ingredients, through text, symbols or a QR code that consumers can scan with a smartphone to relay the information. The federal law supersedes several state labeling laws. Read the full article at http://thehill.com/regulation/ legislation/287743-house-passesgmo-labeling-bill New Foreign Service Officers Sworn In. Ten USDA Foreign Agricultural Service (FAS) employees were sworn in as Foreign Service Officers at USDA headquarters July 13. The new officers will begin working as agricultural attachés at U.S. embassies in nine countries including Guatemala, South Korea, China, Peru, United Arab Emirates, Mexico, Colombia India and Thailand. The new attachés are among about 140 FAS Foreign Service Officers posted to 93 offices at U.S. diplomatic missions around the world, covering 171 countries. USW staff are meeting with many of these officers before they leave on their new

assignments to brief them on our wheat trade issues with those countries. For the full release and more information about FAS, visit www.fas.usda.gov.

Hope for Improved Ag Trade with Cuba. This week, AgriPulse, which covers ag news in Washington, DC, reported that the chance that approval of a bill that end the U.S. prohibition on financing agricultural exports to Cuba is closer than it has ever been, said the author of the legislation, Rep. Rick Crawford.

USDA Acting Deputy Secretary Michael Scuse told Agri-Pulse he thinks “that there is now momentum to make the changes necessary, especially when it comes to agricultural products.”

Low Cash Prices Trigger Government Loan Program.

Kansas AgLand reported this week that for the first time in nearly 15 years, cash wheat prices in Kansas have triggered government loan programs. Farmers and elevator managers are scrambling to bone up on programs like Loan Deficiency Payments (LDP) as HRW wheat price hovers around $3 a bushel ($110/MT). In one Kansas county, the posted price was $0.06 below the government approved loan rate of $3.23 per bushel ($118.70/MT). The story added that one elevator operator said the last time he filed LDP paperwork was 2004. USDA estimated the 2016/17 Kansas HRW crop at almost 12.4 million MT, with a record average yield of almost 3.8 MT per hectare.

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July 19, 2016 U.S. Wheat Exports Start 2016/17 Fairly Strong

By Stephanie Bryant-Erdmann, USW Market Analyst U.S. commercial sales for marketing year 2016/17, which began June 1, are off to a welcome start. As of July 7, U.S. wheat export sales for all classes totaled 8.78 MMT, up 35 percent from export sales on the same date in 2015/16. USDA now expects 2016/17 exports to total 25.2 MMT, up 19 percent from 2015/16, noting that this would be the highest volume in three years.

USDA reported hard red winter (HRW) year-to-date exports at 3.29 MMT, up 86 percent from the prior year. Significantly higher demand from Brazil is expected this year after rain delayed harvest and damaged wheat quality in both Brazil and Argentina, normally Brazil’s top supplier. As of July 7, HRW sales to Brazil totaled 232,000 MT, more than double the volume to Brazil at the same time last year. Sales to Mexico are also up 81 percent year over year due to more competitive pricing. To date, Chilean and Peruvian HRW sales are already greater than total 2015/16 HRW sales.

Sales of soft red winter (SRW) for 2016/17 are down 35 percent year over year at 827,000 MT, due in part to smaller carry-in stocks of milling quality SRW and early market perceptions about a recurrence of quality issues in this year’s crop. However, with nearly half of the 2016/17 SRW production safely in the bin, quality looks much improved.

22Rediscover RediscoverWH WH E AT| AUGUST | AUGUST 2016 22 E AT 2016

Sales to some Latin American countries, including Honduras, El Salvador and Costa Rica are slightly ahead of last year’s pace.

Hard red spring (HRS) sales of 3.02 MMT are up 53 percent year over year. As of July 7, buyers in the Philippines purchased 437,000 MT, nearly double their volume last year at the same time. The Philippines is the top HRS buyer, and sales to eight of the top ten HRS customers are also ahead of last year’s pace. Sales to the European Union (EU) of 157,000 MT are nearly triple last year’s sales on the same date. Year to date sales to Venezuela of 145,000 MT are nearly equal to total 2015/16 HRS sales.

As of July 7, exports of soft white (SW) wheat are up 27 percent year over year at 1.51 MMT. Sales to the top three SW customers — Philippines, Japan and South Korea — are all ahead of 2015/16 pace. U.S. SW sales to Thailand and Indonesia are also up. Year-to-date, Indonesia has purchased 110,000 MT, up from 42,000 MT on the same date in 2015/16. Thailand sales are up 57 percent year over year at 74,000 MT. High prices continue to constrain durum exports. Year to date durum exports total 128,000 MT, down 54 percent from the same time last year. To date, Nigeria, the EU, Guatemala and Panama are the top durum buyers. A significant portion of these 2016/17 sales are designated as “sales to unknown designations.”

The U.S. Wheat Industry Helps Celebrate 100 Years of Grain Standards On July 12, USW Chairman Brian O’Toole and National Association of Wheat Growers (NAWG) President Gordon Stoner sent a letter of congratulations to USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) on the 100th anniversary of the U.S. Grain Standards Act of 1916 (USGSA). Chairman O’Toole and President Stoner also told GIPSA Administrator Larry Mitchell that the remarkable benefits from the USGSA to the U.S. grain supply chain and its customers is worthy of an official proclamation from the U.S. Congress recognizing the Act and this important milestone.

The USGSA was a landmark law that helped resolve chaotic and inefficient marketing conditions and increase the trust in U.S. agricultural commodities. U.S. grain standards for wheat were established under the Act in 1917.

Then, when fraud in the system again threatened the credibility of the U.S. grain marketing system, Congress amended the Act in 1976 to establish official weighing services, record keeping by elevators, registration of grain exporters, and user fees to cover federal supervision costs.

Importantly, that amendment established the Federal Grain Inspection Service (FGIS) and required either federal or state agency inspections for export.

“It would be nearly impossible to calculate the value of the USGSA and the FGIS to America’s wheat farmers and their customers,” O’Toole and Stoner noted. “Today, the work FGIS does represents a

critical component in U.S. wheat’s reputation as the world’s most reliable supply. With half of the wheat that U.S. farmers produce every year available for export, inspection helps increase the value of that wheat to overseas customers.

“When USW brings buyers to the United States, one of the first stops is almost always at an FGIS regional office or laboratory at an export elevator,” they added.

“Buyers around the world know that the wheat they tender for from the United States is the wheat that will be loaded on the vessel. FGIS inspection logs give importers the data to extract the most value from their tenders.

If there is a discrepancy, buyers know that experienced workers at the National Grain Center in Kansas City, MO, have the samples needed to conduct another impartial inspection.”

O’Toole and Stoner went on to say that overseas buyers are more willing to purchase U.S. wheat because they have confidence that our industry, growers and grain grading system consistently deliver high value products.

The wheat leaders concluded: “On behalf of the wheat farmers USW and NAWG represent and their customers, we thank Congress, GIPSA, FGIS and the hundreds of individual grain inspectors across the country and we look forward to the next 100 years of collaboration as we grow and prosper together.”

Learn more about FGIS grain inspection here: http://blogs. usda.gov/2015/07/10/usda-graininspectors-work-to-upholdamericas-reputation-for-qualitysupport-new-markets/.

A Busy Season of Wheat Market Development Activities USW works steadily to share trade, market and technical information for the world’s wheat buyers. The first few months of marketing year 2016/17 (June to May) are proving to be a very busy time, including several face-toface meeting opportunities for visiting trade teams, short courses and other activities, all funded by state wheat commissions and export market development funding from USDA’s Foreign Agricultural Service (FAS).

In June, USW’s Sub-Saharan Africa regional office provided tuition for three milling managers to take the IAOM Executive Milling Course and sponsored eight millers at a Nigerian and South African Flour Millers Short Course at Kansas State University’s IGP Institute.

USW brings trade teams from around the world to the United States each summer to witness wheat harvest and get a firsthand look at the new crop’s initial quality. This June, Nigerian millers visited Texas, Kansas and North Dakota. In addition, USW Assistant Regional Vice President Joe Sowers traveled with four Philippine journalists to the Pacific Northwest and Washington, DC, to visit with farmers, discuss supply and quality with industry representatives and visit elevators and port facilities, as well as to meet with USDA and other U.S. government officials. To read more about that effort, visit http:// www.mb.com.ph/ph-emergessecond-biggest-buyer-of-uswheat/.

A highlight in June was the very successful Latin American and Caribbean Buyers Conference in Portland, OR, with nearly 80 overseas buyers and industry representatives participating.

Read more about the conference at Wheat Buyers Conference Positions U.S. Wheat as an Exceptional Value. USW President Alan Tracy also traveled to London in June to give an update on world wheat market issues at the International Grains Council meeting.

Early July saw a five-person Korean team of bakers participate in a whole wheat cookie and cracker short course at the Wheat Marketing Center (WMC) in Portland, OR. The bakers worked on developing whole wheat flourbased formulations using SW for biscuit items and product quality evaluation. A custom course on pasta production and technology for several customers from South America, Mexico and Africa at the Northern Crops Institute (NCI) in Fargo, ND, is set to begin July 18. Starting July 30, NCI and USW will also host a workshop in which wheat buyers from South Asia will learn how to write tenders to get the most value possible from U.S. wheat purchases. At about the same time, beginning and advanced Asian noodle production courses for Nigerian customers start at the Wheat Marketing Center.

Customer visits continue in July and into August with six more trade teams from Colombia, Venezuela, Mexico, as well as two separate teams from Korea and a team from the growing market of Indonesia. Looking ahead to September, USW is planning a Rediscover RediscoverWH WHEEAT AT| |AUGUST AUGUST2016 2016 23 23

seminar for durum buyers to be held in Morocco.

The connections forged through visits and courses like these are the very foundation of past, present and future success for U.S. wheat farmers, industry stakeholders and overseas customers.

“Our visitors always say that building relationships with farmers and the people in the U.S. wheat export supply chain makes a difference in their jobs,” said USW Director of Programs and Planning Jennifer Sydney.

“They get firsthand knowledge of the new crop and proof that the United States remains the world’s most reliable supplier of high quality wheat.”

New Food for Progress Funding Reflects Food Aid Benefits

By Elizabeth Westendorf, USW Policy Specialist Last week, USDA announced Food for Progress funding allocations for fiscal year 2016. A total of $153.2 million in funding will go to projects in eight countries that USDA estimates will reach over 3.8 million beneficiaries.

Half of the countries on the list (Burkina Faso, Ethiopia, Malawi, and Mozambique) are in Africa, where this Food for Progress funding will not only enable development projects in these countries, but will also raise money for those projects by providing U.S. commodities for sale in the local markets.

All four of these countries are experiencing severe droughts that have hurt domestic food 24Rediscover RediscoverWH WH E AT| AUGUST | AUGUST 2016 24 E AT 2016

production. The monetized commodities through Food for Progress supplement locally produced food supplies that are currently not sufficient to fully meet their populations’ needs.

They also provide economic stimulus to encourage continued development that can lead to more resilience in future food crises.

Studies show a strong positive correlation between food insecurity and political instability.

When it seems like instability around the world is rising and there are more crises demanding U.S. foreign assistance, these food aid programs are more important than ever.

The United states is the largest provider of food aid worldwide.

USAID funding has evolved to include new methods of reaching those in need, but U.S. wheat farmers believe traditional inkind food aid will always have a place in both emergency and developmental humanitarian aid programs. New emergency aid tools like local and regional procurement and cash vouchers supplement the foundational aid tool of in-kind food aid.

USW is committed to supporting programs that help feed food-insecure people. In a world with political uncertainty and increasingly volatile climate conditions, U.S. wheat farmers are proud that their product is going to benefit food-insecure populations through USDA and USAID emergency and developmental aid.

USW Farmer Directors to Meet in Fargo, ND At their annual meeting July 17 to 20, 2016, USW directors representing 18 state wheat commission member organizations will hold committee meetings, including two joint committees with the National Association of Wheat Growers (NAWG), and install officers for 2016/17 among other activities.

The board meets in Fargo, ND, this year, a site selected by outgoing Chairman Brian O’Toole of Crystal, ND. USW will share more information during and after the meeting.

Guest speakers at the joint board meeting include North Dakota’s Lieutenant Governor Drew Wrigley, the Agriculture Commissioner of North Dakota, Doug Goehring, and President of The Money Farm, Mike Krueger.

The board will also hear an update on trade relations with Cuba from USW Regional Vice President Mitch Skalicky and Assistant Director of Policy Ben Conner. Farmers who participated in “board team” travel to Latin America and North Asia earlier this year will report on their experience.

One of the highlights will be a presentation by Vance Taylor, the President and General Manager of the North Dakota Mill and Elevator Association in Grand Forks, ND, the only state-owned milling facility in the United States. Over the years, the organization has worked cooperatively with state agencies in promoting North Dakota and its high quality products by participating with and hosting international trade

teams, including wheat buyers, and serving as a resource center for training, research and testing.

The North Dakota Mill receives no funds or financial assistance from the State of North Dakota to subsidize the milling operations, but has contributed more than 50 percent of its profits to the North Dakota State General Fund for more than 35 years and continues to be a valuable asset to the State of North Dakota.

USW and Chairman O’Toole wish to thank these supporting sponsors: BNSF Railroad, Columbia Grain, North Dakota Mill and Elevator Association, Monsanto, Syngenta, AgCountry Farm Credit Services, Northern Crops Institute, Dakota Growers Pasta Co., U.S. Durum Growers Association, Otto Ag, Dakota Specialty Milling and the conference host North Dakota Wheat Commission.

Wheat Industry News House Passes GMO Labeling Bill. "The Hill" reported that a bill to create a federal labeling standard for foods with genetically modified ingredients passed in the U.S. House of Representatives and Pres. Obama is expected to sign the bill into law directing USDA to create a national labeling standard. It allows food producers to choose how they want to disclose the presence of genetically modified ingredients, through text, symbols or a QR code that consumers can scan with a smartphone to relay the information. The federal law supersedes several state labeling laws. Read the full article at http://thehill.com/regulation/ legislation/287743-house-passesgmo-labeling-bill

New Foreign Service Officers Sworn In. Ten USDA Foreign Agricultural Service (FAS) employees were sworn in as Foreign Service Officers at USDA headquarters July 13. The new officers will begin working as agricultural attachés at U.S. embassies in nine countries including Guatemala, South Korea, China, Peru, United Arab Emirates, Mexico, Colombia India and Thailand. The new attachés are among about 140 FAS Foreign Service Officers posted to 93 offices at U.S. diplomatic missions around the world, covering 171 countries. USW staff are meeting with many of these officers before they leave on their new assignments to brief them on our wheat trade issues with those countries. For the full release and more information about FAS, visit www.fas.usda.gov.

Hope for Improved Ag Trade with Cuba. This week, AgriPulse, which covers ag news in Washington, DC, reported that the chance that approval of a bill that end the U.S. prohibition on financing agricultural exports to Cuba is closer than it has ever been, said the author of the legislation, Rep. Rick Crawford.

USDA Acting Deputy Secretary Michael Scuse told Agri-Pulse he thinks “that there is now momentum to make the changes necessary, especially when it comes to agricultural products.”

Low Cash Prices Trigger Government Loan Program.

Kansas AgLand reported this week that for the first time in nearly 15 years, cash wheat prices in Kansas have triggered government loan programs.

Farmers and elevator managers are scrambling to bone up on

programs like Loan Deficiency Payments (LDP) as HRW wheat price hovers around $3 a bushel ($110/MT). In one Kansas county, the posted price was $0.06 below the government approved loan rate of $3.23 per bushel ($118.70/ MT). The story added that one elevator operator said the last time he filed LDP paperwork was 2004. USDA estimated the 2016/17 Kansas HRW crop at almost 12.4 million MT, with a record average yield of almost 3.8 MT per hectare.

July, 29 2016 Market Signals Best Time to Buy is Now

By Stephanie Bryant-Erdmann, USW Market Analyst As of Friday, July 22, there was a 50 cent per bushel carry in the market between KCBT September wheat and KCBT March wheat.

With harvest wrapping up, this market signal tells U.S. farmers that wheat storage is more profitable than selling at current values. However, that carry is also telling buyers that wheat prices will increase in the coming months and that they should, if possible, buy now and capture that storage premium for themselves.

This carry in the market widened for several reasons, including the fact that wheat competes for elevation with corn and soybeans. USDA expects U.S. corn exports to increase 12 percent year over year to 133 million metric tons (MMT) and expects soybean exports to reach 138 MMT, up 5 percent from 2015/16. Corn and soybean exports ― though unseasonably strong ― are not the current Rediscover E EATAT| AUGUST 2016 RediscoverWH WH | AUGUST 201625 25

primary focus as traders wait for U.S. corn and soybean harvest to begin in September and October.

Once those harvests begin, demand for barge and rail freight and elevation will all increase, which factored into the 25 cent carry from the KCBT nearby contract price compared to the December contract price on July 22.

While this competition partially explains the carry between the nearby futures and the March contract, there are other factors at play. The nearby futures price for KCBT wheat is near 10-year lows and currently below the cost of production for many producers, which not only makes them reluctant to sell, but also means prices are low enough to trigger Loan Deficiency Payments (LDP) in several counties. An LDP provides U.S. farmers with a short-term loan if they retain ownership of their wheat and the current local cash price in a county is below the applicable county loan rate. This program encourages U.S. farmers to retain ownership of their wheat until prices improve, supporting farmer storage.

Additionally, the carry represents the statistical improbability of a fourth consecutive global production record. According to USDA data, since 1960, the only time the world’s farmers produced four consecutive record crops was from 1980 to 1985. This improbability is seen in the uncertainty surrounding wheat production in a few major exporting countries this year.

While the 2016/17 U.S. hard red winter (HRW) harvest is 26 Rediscover RediscoverWH WHE AT | AUGUST 2016 26 E AT | AUGUST 2016

nearly complete and safely in the bins, FranceAgriMer reported July 21 that harvest was 17 percent complete, compared to 53 percent on the same date a year ago. France ― the European Union’s largest producer ― received excessive rain throughout the spring and summer, hurting quality and yields. French consultancy ODA Groupe estimates French wheat production at 30.4 MMT. If realized, that would be 27 percent lower than last year’s record yield of 41.0 MMT. Delayed planting progress in Argentina has also started to cut into yield potential there.

This is certainly a buyers’ market, but buyers will need to compete with corn and soybean exports for elevation capacity and with storage revenues for U.S. wheat.

U.S. Wheat and NAWG Joint Committees Meet in Fargo

By Dalton Henry, USW Vice President of Policy The two joint farmer committees of USW and the National Association of Wheat Growers (NAWG) met last week in Fargo, ND, for a policy update and to consider key issues facing the wheat industry. The joint committees were created more than a decade ago to enable and ensure close collaboration between the two organizations on policy priorities in trade and technology.

The Joint Biotechnology Committee, which has broadened its agenda to include a number of technologies, heard updates from private breeding companies on non-GM products they are

rolling out to growers. Many of these companies are working to help increase efficiency and drive additional productivity.

Two major updates included the continual development of hybrid wheat and products to produce better seeding rate recommendations.

The committee also heard from a researcher from Cibus, a company that has a process for producing gene-edited plants that do not contain any foreign DNA, but can yield substantial improvements for both growers and end-users. Recently they have focused on flax and canola, but according to the speaker, while they do not any active wheat projects, the technology could be readily applied in the wheat industry.

The Joint International Trade Committee considered a range of updates on several priority trade issues for the wheat industry including foreign country domestic support, the TransPacific Partnership (TPP) and possible future negotiations at the World Trade Organization (WTO).

Staff presented additional detail about the domestic support study that was released earlier this spring. The study focused on wheat support policies in China and their impact on U.S. producers and producers in other exporting countries. In the U.S., the total farm gate losses are now estimated at $653 million, an increase of about $100 million from over a year ago, caused by the continued decline of world wheat prices amid burgeoning Chinese wheat stocks.

NAWG staff discussed TPP and possible windows for Congressional consideration this calendar year. Staff were confident that the U.S. Trade Representative’s (USTR) office has been working closely and making progress with Congressional leadership to prepare for eventual introduction of the legislative text ratifying TPP, even though the negative rhetoric on trade has increased dramatically from many political candidates during the U.S. election season. TPP would lower tariffs and import restrictions on wheat to the benefit of U.S. wheat farmers and their customers overseas.

Committee members also briefly discussed the current negotiating status at the WTO. Though negotiations on agricultural market access have been largely stalled for some time, progress is being made in other sectors including services and environmental goods. Progress in these other areas may provide a template for future agricultural negotiations. The next WTO ministerial, the most likely target for an attempt at agreement on some portion of unresolved issues, will be in December 2018. The WTO remains a key body for liberalizing trade and ensuring a rules-based trading system exists.

Spring (HRS) and Durum Wheat Quality Tour, North Dakota producers should see a crop that averages more than 45 bushels per acre (bu/ac) statewide for the fifth year in a row. This week 72 crop scouts traveled across North Dakota, evaluating yield potential and wheat quality concerns.

Overall, they estimated a final average yield potential of 45.5 bu/ ac, which is considerably smaller than last year’s estimate but still above the long-term average. Final tour estimates were calculated based on 455 stops over the past three days, and the individual class estimates were an average yield potential of 45.7 bu/ac for HRS, 45.4 bu/ac for durum and 34.7 bu/ac for HRW. USDA currently projects total North Dakota HRS acreage at 6.3 million acres and production at 279 million bushels.

By Dalton Henry, USW Vice President of Policy

Participants on the annual tour represent the full range of the wheat industry, including millers, bakers, growers, traders, reporters, researchers and USDA staff. Each day tour vehicles travel a region of the state on eight unique routes, covering 90 percent of North Dakota wheat producing counties and parts of northern South Dakota. At the end of each day, participants meet to report on the fields they scouted and combine their data to produce a summary of results. USW sent two colleagues on the tour this year: Vice President of Policy Dalton Henry and Market Analyst Stephanie Bryant-Erdmann.

As harvest begins in North Dakota, farmers are expecting a crop that continues this year’s trend of above average yields and production. According to crop scouts on the 2016 Hard Red

The first day of the tour covered most of southern North Dakota and northern South Dakota, where participants faced challenging conditions as summer storms left fields muddy and some

Wheat Quality Tour See Variability, Above Average Crop on HRS Tour

hail damage. HRS yields from the first day averaged 43.1 bu/ ac, 8 bu/ac under the 2015 tour, but only 2 bu/ac under the 5-year average. Tour participants noted the advanced stage of the crop, seeing many harvested fields on the southernmost routes.

Growers in attendance stated the crop was ahead of schedule primarily due to warm spring weather that allowed planting to begin in early April. One of the cars that followed a route through South Dakota stopped at several elevators that were already taking in wheat and found early reports of protein levels above the 2015 crop.

On the second day, tour routes covered much of central and northwest North Dakota, traveling from Bismarck to Devil’s Lake.

Scouts reported seeing a greater concentration of wheat fields compared to the first day, more durum fields than previous years and very few harvested fields.

Overall yields on the second day averaged 46.9 bu/ac for HRS and 45.4 for durum, compared to last year’s averages of 47.3 bu/ ac and 40.2 bu/ac respectively.

There was an increase of leaf disease reports from the first day, though the earlier stage of the crop might have facilitated easier identification. Even though the wet weather late in the growing season was conducive to rust diseases, growers in attendance reported disease pressure was about average. USDA’s National Agricultural Statistics Service also noticed an increase in durum fields and project that North Dakota farmers increased durum acres by 16 percent to 1.3 million acres, the most since 2012.

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The third and final day of the tour is always shorter, with scouts making just 78 stops as they traveled on separate routes from Devil’s Lake to Fargo. On this trip through the northeast part of the state, wheat fields experienced more late season moisture, likely leading to increased yields.

Participants took the opportunity to recognize and say thank you to Ben Handcock ― the longtime executive director of the Wheat Quality Council and lead tour coordinator. After serving the council for more than 25 years, Handcock is retiring soon and participated in his last official wheat tour.

For more information and for results from previous tours visit the Wheat Quality Council’s website at www. wheatqualitycouncil.org.

Trade Visit to Demonstrate U.S. Wheat Competitive Advantages to Venezuelan Millers Quality control and purchasing managers from three Venezuelan flour mills will visit North Dakota, Nebraska, Kansas and Ohio July 31 to Aug. 6, 2016, to learn more about the value of working with the U.S. wheat supply chain. With funding from USDA’s Foreign Agricultural Service (FAS), USW is sponsoring this trade team in cooperation with the North Dakota Wheat Commission, Nebraska Wheat Board, Kansas Wheat Commission and Ohio Small Grains Marketing Program.

Chad Weigand, USW Assistant Regional Director for Mexico, Central America and the Caribbean, said U.S. wheat exports to Venezuela are not as 28Rediscover RediscoverWH WH E AT| AUGUST | AUGUST 2016 28 E AT 2016

strong as they once were, in part because increased government intervention and limited access to U.S. dollars have forced millers there to make cost the primary buying criterion.

Venezuela imports durum, high protein spring wheat and soft red winter wheat. However, current market conditions there have given Mexican durum a competitive advantage. Canadian western red spring wheat has only recently come up in price to near parity with U.S. HRS wheat, but the high U.S. dollar value continues to favor Canadian origin export prices.

For the vibrant cookie and snack market in Venezuela, soft red winter grown in eastern Canada continues to compete with U.S. SRW. Participants on this team represent some of the largest mills in Venezuela, but they do not have significant knowledge of U.S. wheat quality, its marketing system or federal inspection services.

“With key decision makers like these, we have to demonstrate why performance and value is worth more, but it is very difficult for our staff to conduct activities in Venezuela,” said Weigand.

“By coordinating with our state wheat commissions, however, we can bring these customers to the United States to see our production and export system at work. That first-hand experience will help increase their confidence in U.S. wheat.”

Weigand, who is based in USW’s regional office in Mexico City, is leading the team, which includes Jenny Villasuso, Purchasing Manager for MONACA, the

second largest milling group in Venezuela. Laura Paz is Purchasing and Quality Manager for Pastas Capri in Caracas, one of Venezuela’s largest pasta producers. Violeta Rosales is Purchasing Manager for Molinos Hidalgo, which operates a mill in Catia La Mar. U.S. Wheat Associates Announces Several Staff Promotions USW, the industry’s export market development organization, promotes three associates to Vice President. Ian Flagg is named Regional Vice President for the organization’s European and Middle Eastern, North and Eastern Africa regions. Jennifer Sydney becomes Vice President of Programs and Planning, and Dalton Henry becomes Vice President of Policy. In addition, Shawn Campbell is promoted to Deputy Director, West Coast Office, and Jim Frahm becomes Senior Advisor.

Flagg is based in USW’s regional office in Rotterdam, The Netherlands. Sydney and Henry serve in the organization’s Headquarters Office in Arlington, VA. Campbell works in Portland, OR, and Frahm works half-time from his home in Charleston, SC. “I have said many times how proud I am of the people who work at U.S. Wheat Associates,” said USW President Alan Tracy.

“These associates and the people who report to them are making a real and positive difference for USW and for the U.S. wheat farmers we represent. Their commitment to their jobs and promoting U.S. wheat is very strong and is clearly evident in the results of their work.”

Minnesota native Ian Flagg first served USW as Assistant Director, West Coast Office, then as Market Analyst in the Headquarters Office, before accepting a position in 2009 as Assistant Director for the Middle East, East and North Africa (MEENA) region in Cairo.

He was promoted to Regional Director in 2014 and moved to Casablanca, Morocco, then transferred again to Rotterdam in January 2016 to direct activities in MEENA and Europe. Flagg has a bachelor’s degree in economics from Minnesota State University, Moorhead, and a master’s degree in Agribusiness and Applied Economics from North Dakota State University.

Jennifer Sydney directs the preparation and submission of USW’s annual Unified Export Strategy proposal to the USDA’s FAS, manages FAS activity amendments, coordinates state funding and supervises USW Programs staff. Sydney had similar responsibilities at the U.S. Grains Council in Washington, DC, before joining USW in 2010.

She is a native of Greeley, CO, and received a bachelor’s degree in Asian Studies from the University of Colorado.

Dalton Henry has lead responsibility for coordinating the USW policy team’s efforts and managing relations with wheat value chain organizations. He joined USW in March 2015 after five years with Kansas Wheat as Director of Governmental Affairs. Henry grew up on and is still involved with a diversified crop and livestock operation near Randolph, KS. He has a bachelor’s degree in Agricultural Communications and Journalism from Kansas State University.

As Deputy Director, West Coast Office, Shawn Campbell is responsible for liaison with the grain export trade and constituent state-level wheat commissions, hosting visiting trade delegations and additional support for headquarters and overseas office staff. Before joining USW in 2009, Campbell was an agricultural economist for an Alberta, Canada, feedlot. An Oregon native, Campbell earned a bachelor’s degree in Agribusiness and Agricultural Systems Management and a master’s degree in Agricultural Economics from the University of Idaho.

Jim Frahm has been with USW since 1978, serving most recently as Vice President of Planning. He coordinated long term strategy and program evaluations with and between USW's overseas offices and USDA FAS. As Senior Advisor, Frahm will continue to represent the organization on wheat quality and sanitary/ phytosanitary issues and in other assignments. His first position with USW was in Rotterdam directing market development activities in Eastern Europe. He worked as a grain merchandiser for Continental Grain before joining USW. Frahm received a bachelor's degree in History and International Relations from Iowa State University. He also earned a master’s degree in International Affairs specializing in Russian area studies at Columbia University.

USW Farmer Directors Install New Officers at Summer Board Meeting The USW Board of Directors installed new officers at its annual meeting July 20, 2016, in Fargo,

ND. Jason Scott of Easton, MD, was installed as Chairman, while last year’s Chairman Brian O’Toole of Crystal, ND, transitioned to Past Chairman and Chairman of the USW Budget Committee. Other officers installed included Mike Miller of Ritzville, WA, as Vice Chairman and Chris Kolstad of Ledger, MT, as Secretary-Treasurer. USW officers were elected to these one-year positions at the January 2016 Winter Wheat Conference in Washington, DC. Jason Scott is a sixth generation wheat farmer from Maryland’s Eastern Shore, where he is farm manager of Walnut Hill Farms and produces SRW wheat, row crops and vegetables. He is also an Independent Sales Representative for Pioneer HiBred Int'l, under the title Scott’s Seed, L.L.C. Scott is a founding member of the Dorchester County Young Farmers, past president of the Maryland Grain Producers Utilization Board and the Maryland Grain Producers Association. In 2011, he won the Maryland Young Farmers Achievement Award. In his seven years on the USW Board, Scott has represented his state and USW on two board team delegations to Africa and Europe and served as Secretary-Treasurer and Vice Chairman as well as on several USW committees. He and his wife Dr. Casey Scott have a young daughter.

Mike Miller is a fourth generation farmer who operates a dryland wheat farm and grows multiple crops on a separate, irrigated farm in east central Washington. He has served on many local, state and national boards, and is in his third term Rediscover E EATAT| AUGUST 2016 29 RediscoverWH WH | AUGUST 2016 29

on the Washington Grain Commission and his fifth year as a USW director representing Washington. Miller is also very active in supporting wheat research and development. He and his wife, Marci, have three children.

Chris Kolstad is the fourth generation of his family to farm in Montana’s “Golden Triangle” region. He and his wife Vicki have four children, including their son Cary who is a partner in their operation. They grow HRW wheat, dark northern spring wheat and durum, plus barley and dry peas. A commissioner of the Montana Wheat and Barley Committee, Kolstad has represented his state on the USW board since 2012. He is also a member of the Montana Grain Growers Association and Montana Farm Bureau. His community leadership includes serving on his local school board, as treasurer of his family’s church and as a regular blood donor who has given almost 19 gallons of blood since 1972.

Brian O’Toole is the president of T.E. O'Toole Farm Seed Company.

He and his wife Sara have four children and raise wheat, edible beans and sugarbeets on their northeast North Dakota farm.

O'Toole is an experienced agricultural and community leader. He serves on the North Dakota Wheat Commission, on the board of the Wheat Marketing Center in Portland, OR, and is Chairman of SBARE Wheat Granting Committee.

He is also past president of the North Dakota Crop Improvement and Seed Association and past president of Crystal Farmers Elevator Co-op. O’Toole has 30Rediscover RediscoverWH WH E AT| AUGUST | AUGUST 2016 30 E AT 2016

received the Young Outstanding Farmer Award, Master Farmer Award and Friends of 4-H Award.

He has served as SecretaryTreasurer and Vice Chairman of USW. Official business was called to order Tuesday, July 19, and continued through Wednesday, July 20. Reports to the board included a welcome from North Dakota Lieutenant Governor Drew Wrigley, background on local production and policy from the Agriculture Commissioner of North Dakota, Doug Goehring, and a review of market factors that could change the dynamics of the world wheat market from Mike Krueger, President of The Money Farm. The board also heard an update on trade relations with Cuba from Tyler Jameson, Legislative Assistant to Sen. Heidi Heitkamp (D-ND), USW Regional Vice President Mitch Skalicky and Assistant Director of Policy Ben Conner. The farmer directors from 18 states also heard from Vance Taylor, President and General Manager of the North Dakota Mill and Elevator Association in Grand Forks, ND, about the history and output of the only state-owned milling facility in the United States.

USW's next board meeting will be held jointly with NAWG in Denver, CO, Nov. 2 to 5, 2016.

Wheat Industry News IGP Institute to Host BuhlerKSU Executive Milling Course.

This course, scheduled for Nov. 7 to 26, 2016, at the IGP Institute Conference Center in Manhattan, KS, will focus on understanding the underlying principles of the milling process and the parameters that can be influenced

by either the raw material or the milling system; understanding the challenges of the operating staff; and learning which critical control points to check in order to judge whether an operation is running well. For more information and registration, visit www.grains.k-state.edu/igp/.

Subscribe to USW Reports.

USW has added a “Subscribe” menu at www.uswheat.org where visitors may subscribe to this newsletter, the weekly Price Report and the weekly Harvest Report (available May to October.) subscribe at http://www.uswheat. org/subscribe1 Follow USW Online. Visit our page at www.facebook.com/ uswheat for the latest updates, photos and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter at www.twitter. com/uswheatassoc, additional photos at www.flickr.com/ photos/uswheat, plus video stories at www.youtube.com/ uswheatassociates.

Fresh Peach Pie Bake this tasty treat for National Peach Pie Day on August 24!

Ingredients Peach Filling: ½ cup granulated sugar ¼ cup brown sugar 3 tablespoons cornstarch or 2 tablespoons tapioca ½ teaspoon almond extract ¼ teaspoon each ground cinnamon and nutmeg, optional 4-5 cups peeled, sliced fresh peaches * 2 tablespoons butter or margarine Flaky Pastry for 2 crust pie: 1 ½ cups all-purpose flour ½ cup white whole wheat flour 1 teaspoon salt ¾ cup vegetable shortening 5-6 tablespoons ice water Milk and sprinkle of sugar, optional

Nutrition Information Yield: one 9” pie, 8 slices.

(1 slice, 245 g): 650 calories, 22g fat, 5g fiber, 6g saturated fat, 0g trans fat, 102g carbohydrates, 8mg cholesterol, 298mg sodium, 11g protein, 6mg vitamin C, 5mg iron, 21mg calcium.

Directions

1. Prepare peach filling. In large bowl, stir together dry ingredients and mix lightly with sliced peaches.

2. For crust, combine all-purpose flour, white whole wheat flour and salt in mixing bowl. Using a pastry blender, or two knives, cut shortening into flour until it resembles small peas. Add half of ice water at a time and chase around the bowl with a fork, then add other half.

Dough should cling together to form a ball.

3. Divide in half and form into flattened balls. Roll out one portion on floured surface to a circle 1 ½ inches larger than inverted 9” pie pan.

4. Fit loosely into pan. Fill with prepared peaches. Dot with butter.

5. Roll out remaining dough. Cut in slits for escaping steam. Place top crust over filling and trim ½” beyond rim of pan.

Seal edge by folding top crust under bottom crust. Flute edge with fingers or tines of a fork. Brush top of pie with milk and a sprinkle of sugar.

6. Bake in preheated 450°F oven for 10 minutes, then 350°F for 30 to 35 minutes or until crust is nicely browned and juice begins to bubble through slits in crust. Cool on rack before slicing.

Yield: one 9” pie, 8 slices. *Variation: 36-40 ounces frozen sliced peaches—partially thaw and drain, sugar to taste or use ½ cup.

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Hello Kansas Wheat.

Maltby Market Analysis

by Dan Maltby

Late Friday Reuters reported a Washington state farmer found some herbicide-resistant wheat, that turned out to be GMO. This isn’t the first time this has happened. I ask HOW can this keep happening? http://www.reuters.com/article/us-wheat-washington-gmo-idUSKCN10920K I suspect market sabotage; a Fund Manager, short Chgo wheat futures, (shown in this weekly continuous chart, going back to 2003) knows even though wheat is cheap, it can always get cheaper. The upper red line is $4.00. The next one is $3.60, which seems likely IF $4.00 can’t hold. $2.80 is below $3.60…omega. Those were the lows last seen in late 2004.

This chart is a KC U daily candlestick, showing KC Sept also struggling to hold the $4.00… wowzers.

Charts and discussions follow, with the goal of giving you useful information to help you with your business. My disclaimer remains the same: these are my sometimes rapidly changing opinions; the markets are quite treacherous; and past performance is no guarantee…dm Kansas Wheat market update #231 danmaltby.riskmgmt@gmail.com 07/29/16 pg. 1

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Rediscover WHE AT | AUGUST 2016

The KC/Chgo Sept wheat spread chart indicates Chgo wheat futures are declining faster than KC U wheat. I believe this means USA HRW is able to compete for exports, and for domestic mill grind, and also as a feed substitute.

Unfortunately, the weekly futures table has red fonts almost everywhere, meaning if USA HRW wants to keep doing business, it has to remain competitive. Funds are short wheat, although seem more willing to push Chgo more than KC; and funds are short corn, and have reduced bean longs.

CLOSE

KWU16

KWZ16

KWN17

CU16

CZ16

CN17

WU16

MWU16

MWZ16

SX16

07/29

$4.10

$4.36

$4.73

$3.35

$3.43

$3.63

$4.08

$4.88

$5.04

$10.03

07/22

$4.19

$4.45

$4.83

$3.35

$3.42

$3.63

$4.25

$4.95

$5.11

$9.88

07/15

$4.14

$4.40

$4.78

$3.52

$3.58

$3.74

$4.25

$4.97

$5.12

$10.57

07/08

$4.21

$4.46

$4.82

$3.55

$3.63

$3.76

$4.35

$5.01

$5.16

$10.58

07/01

$4.12

$4.36

$4.73

$3.60

$3.67

$3.86

$4.30

$5.00

$5.16

$11.38

06/24

$4.41

$4.57

$5.03

$3.89

$3.94

$4.09

$4.65

$5.27

$5.42

$10.79

06/17

$4.79

$5.03

$5.37

$4.43

$4.49

$4.55

$4.95

$5.49

$5.62

$11.48

06/11

$4.86

$5.10

$5.44

$4.28

$4.31

$4.41

$5.07

$5.47

$5.62

$11.63

06/03

$4.90

$5.13

$5.47

$4.20

$4.20

$4.32

$5.07

$5.48

$5.61

$10.85

05/27

$4.76

$4.99

$5.33

$4.14

$4.14

$4.24

$4.92

$5.36

$5.49

$10.56

05/20

$4.65

$4.89

$5.16

$3.97

$3.97

$4.13

$4.79

$5.35

$5.47

$10.50

05/13

$4.73

$4.97

$5.30

$3.93

$3.98

$4.14

$4.84

$5.42

$5.54

$10.55

Corn dropped more than a buck in 5 weeks. What national corn yield are we trading?

Kansas Wheat market update #231 danmaltby.riskmgmt@gmail.com 07/29/16 pg. 2

Rediscover WHE AT | AUGUST 2016 33

The July 12 WASDE update left nat. corn yield at 168 bu/ac. Dec corn that day closed at $3.60.

Corn has dropped about 20c then, and the $3.40 area has held a couple weeks now. I drew in a little rectangle on the chart.

I’d say the market is trading MAYBE a 170 bu/ac national average corn yield. Maybe. I DO NOT think we are trading a 172 bu/ac national average corn yield.

At the peak of the media fueled drought/hot killer temps hysteria, I believe the market made a run at 160 bu/ac. As we’ve dropped a buck, and yields are up 10/bu ac, it looks to me like every bu/ac yield is 10c/bu.

I suspect that means the $4.40 corn is gone, based on the USA supply side of the equation. IF export demand increases due to a supply shock/issue elsewhere, the equation would change. It’s difficult to project South America’s next crop cycle production, so who knows? And along those lines…soybeans rallied $3.00, and set back 2/3 of that, maybe trying to get a better handle on USA yield.

Kansas Wheat market update #231 danmaltby.riskmgmt@gmail.com 07/29/16 pg. 3

34

Rediscover WHE AT | AUGUST 2016

Cash wheat bids in the country remain terrible, as does the basis, at -120 or so.

Date

Dodge

Colby

Goodland

Protection

Scott City Sublette

07/29 07/22 07/15 07/08 07/01 06/24 Date 07/29 07/22 07/15 07/08 07/01 06/24 BASIS 07/29 07/22 07/15 07/08 07/01 06/24 Date 07/29 07/22 07/15 07/08 07/01 06/24

$2.90 $2.99 $2.94 $3.01 $2.92 $3.43 Concordia $3.10 $3.19 $3.19 $3.26 $3.17 $3.43 Dodge -120 -120 -120 -120 -120 -80 Concordia -100 -100 -95 -95 -95 -80

$2.87 $2.96 $2.91 $3.01 $2.97 $3.48 Salina $3.20-$3.25 $3.29-$3.34 $3.29-$3.29 $3.36-$3.36 $3.27-$3.27 $3.58-$3.63 Colby -123 -123 -123 -120 -115 -75 Salina -90, -85 -90, -85 -85, -85 -85, -85 -85, -85 -65, -60

$2.85 $2.94 $2.89 $3.03 $2.95 $3.43 Hutchinson $3.01-$3.30 $3.10-$3.39 $3.07-$3.39 $3.16-$3.39 $3.09-$3.39 $3.42-$3.68 Goodland -125 -125 -125 -118 -117 -80 Hutchinson -109, -80 -109, -80 -107, -75 -105, -75 -103, -73 -80, -55

$2.90 $2.99 $2.94 $3.01 $2.92 $3.38 Wichita $3.08-$3.27 $3.17-$3.36 $3.14-$3.31 $3.16-$3.46 $3.16-$3.27 $3.55-$3.64 Protection -120 -120 -120 -120 -120 -85 Wichita -102, -83 -102, -83 -100, -83 -98, -83 -96, -85 -68, -60

$2.88 $2.97 $2.92 $2.99 $2.99 $3.34 Ark City $3.05 $3.14 $3.09 $3.18 $3.09 $3.42 Scott City -122 -122 -122 -122 -113 -90 Ark City -105 -105 -105 -103 -103 -80

$2.93-$3.00 $3.04-$3.09 $3.02-$3.04 $3.09-$3.11 $3.02-$3.04 $3.41-$3.43

Sublette -117, -110 -115, -110 -112, -110 -112, -110 -110, -108 -82, -80

Spring wheat harvest will increase dramatically over the next 2 weeks, and although the Wheat Quality Tour’s spring wheat survey found yields lower than last year’s, they did find about an average crop. I suspect that will be plenty, although not more overly burdensome than things already are. The talk about the monster Canadian yields has been put on the back burner after this week’s Tour findings.

They can be brought forward again, if needed, of course, but it feels to me like big yield talk on wheat, corn, and beans has taken a breather. Whether that Fund guy who planted those GMO wheat seeds can push it all a lot lower this week …in my opinion, is doubtful. We’re plenty cheap right now.

Kansas Wheat market update #231 danmaltby.riskmgmt@gmail.com 07/29/16 pg. 4

Maltby Market Analysis is provided weekly to members of the Kansas Association of Wheat Growers via email.

To become a KAWG member and subscribe, please contact Jordan Hildebrand at jhildebrand@kswheat.com.

Rediscover WHE AT | AUGUST 2016 35

Upcoming Events AUGUST 2016 • Joint KWC/KAWG Board Meeting, August 9, Wichita • KAWG annual membership meeting, August 10, 7 a.m., Consulate Room 1, DoubleTree

by Hilton Hotel Wichita Airport, Wichita, Kansas • Wheat U, August 10, 8:30 a.m. 3:45 p.m., Wichita, Kansas. Visit wheatu.com for more information.