SAN ANTONIO, Texas – A priority of the U.S. wheat industry is to find ways to counter customer perceptions that Canada and Australia produce a better quality product.
It is one of five critical marketing issues identified by U.S. Wheat Associates, the market development arm of the wheat industry, in its strategic plan.
Mark Hodges, chair of USW’s wheat quality committee, said it wasn’t always like that.
A dozen years ago, 70 percent of American wheat was exported to government buying agencies in places such as China and the former Soviet Union.
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“There wasn’t a lot of consideration about milling and baking quality because it was a government purchase instead of a technical purchase.”
But times have changed and government agencies now account for only 30 percent of U.S. wheat exports with the remainder bought by private companies with more particular tastes.
According to surveys conducted by World Grain magazine and USW, those customers prefer Canadian and Australian wheat.
Hodges said that is primarily due to the fundamental difference in the structure of the wheat industry in those two countries, including monopoly export agencies and restrictions on what varieties growers can plant and sell.
“When you restrict the varieties that are going into the system, it is much easier to control the quality that’s coming out the other side,” he said.
In the U.S., producers can seed whatever varieties they want.
“You can pick any region in Oklahoma and there’s probably 20 to 25 different varieties grown within one region,” said Hodges, who is also the executive director of the Oklahoma Wheat Commission.
If one of those varieties has poor milling and baking qualities, it can cause problems for exporters. For instance, in many of the southern states there are varieties of wheat that are grown both as a forage crop and a grain crop, which diminishes quality.
The U.S. wheat industry has no plans to restrict varieties but it wants to improve on various quality parameters through breeding programs so it can offer customers more consistent quality.
USW’s wheat quality committee has also devised a 10-point plan that includes objectives like developing market tests designed to measure the wheat’s performance at end use, setting wheat class quality targets, establishing recommended varieties lists and calculating the economic value of low dockage wheat.
Hodges said the industry has to forget about the old days when 70 percent of wheat exports went out as No. 2 or better and focus on the new world order where quality is everything for a country that can’t compete on price.
He is confident the plan will narrow the gap between U.S. wheat and that of its competitors.
USW also hopes to catch up to Canada and Australia by working on one of the other five critical marketing issues it has identified, which is to reduce the what it calls the “disruptive effects” of state trading enterprises.
