Brazilian Wheat Importers Set To Examine SRW, HRW Crops

May 30, 2014

Five executives representing the largest flour mills in Brazil will be in the United States June 1 to 7 to learn more about the condition of the U.S. soft red winter (SRW) and hard red winter (HRW) wheat crops as well as the wheat supply system. The team is well timed as Brazilian millers, including the companies represented on this team, are the second largest importers of U.S. wheat this marketing year, purchasing nearly 158 million bushels (4.3 million metric tons).

The trade team visit is sponsored by U.S. Wheat Associates (USW), the Maryland Grain Producers Utilization Board, the Virginia Small Grains Board and Kansas Wheat.

“We are very pleased to bring these millers to the United States because we have a unique window of opportunity to build demand for U.S. wheat in this market,” said Osvaldo Seco, USW assistant regional director for South America, who will travel with the team.

Argentina normally supplies most of Brazil’s imported wheat but could not supply enough to Brazil in 2012 and 2013. These millers have now had success milling HRW and SRW, so this trade team visit was planned to demonstrate why they should continue importing more U.S. wheat in the future.

Brazil imports on average around 260 million bushels (7.1 million metric tons) of wheat, putting Brazil in the list of the world’s top wheat buyers. Before the early 1990s, Brazil originated most of that wheat from the United States. However, the Mercosur free trade agreement allowed millers to import Argentine wheat duty free and established a 10 percent tariff on wheat from non-Mercosur countries like the United States. When Argentina severely restricted wheat export licenses in 2013, USW helped Brazilian millers successfully petition their government to temporarily suspend that tariff. That opened a big opportunity for USW to promote the value of U.S. wheat.

By visiting farms in Maryland and Kansas, meeting with commercial elevator managers and seeing the USDA grain inspection system, these executives will go back to their mills with a greater knowledge of how to specify for the best quality and value from the U.S. HRW and SRW supply, Seco said. In turn, he added, they will have the confidence to consider buying more U.S. wheat even when more Argentine wheat is available, in part because the demand for higher quality wheat foods, including whole wheat products, is growing in Brazil.

USW is the industry’s market development organization working in more than 100 countries. Its mission is to “develop, maintain, and expand international markets to enhance the profitability of U.S. wheat producers and their customers.” USW activities are made possible through producer checkoff dollars managed by 19 state wheat commissions and cost-share funding provided by FAS. USW maintains 17 offices strategically located around the world to help wheat buyers, millers, bakers, wheat food processors and government officials understand the quality, value and reliability of all six classes of U.S. wheat.

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