Milling & Baking News - March 11, 2008 - 42

record price volatility, which
has made risk management still
more challenging, as well as record ocean freight rates and restricted origins.
"Countries that would generally export wheat have decided
not to this year," Mr. Flagg said.
He noted there has been only
"minor shifts" in quality specifications, a situation that has
kept most buyers satisfied.
"An increasingly sophisticated
international customer base is focused less on price and more on
value," he said. "That has helped
soften the blow a little. However, as
a necessity, we could see some shifts
in specifications as we get thinner
throughout the year."
Mr. Flagg said higher prices have
contributed to some sales shifting to new crop, to other origins or
outright cancelled. The escalating
prices also have led to heightened
discussion on transgenic wheat.
"Many are coming to the realization there needs to be a change to
make wheat a little more competitive with other crops in the U.S. and
globally," Mr. Flagg said. "There has
been discussion on drought tolerance and nutrient utilization traits.
And really what this amounts to is
that any significant disruption to
the anticipated 2008 world production will sharply elevate the transgenic discussion."
Longer term, Mr. Flagg said
change will have to occur to make
wheat more competitive with other
crop choices thus assuring future
supplies. He identified two options:
1) increase the price, which the industry is at now, or 2) lower the cost
of production.
"Essentially that leads us to believe that eventually transgenic
wheat will be available," he said.
Impact on the producers
Daren Coppock, chief executive
officer of the National Association
of Wheat Growers (NAWG), said
higher prices generally have left
producers happy, but cautioned the
road ahead may not be as smooth.
"Ten dollar wheat sounds great
and is fun when you can sell it, and
when you have it and can put it into
the market, but you heard people
talk about other inputs increasing, seed royalties increasing, rail
freights increasing," Mr. Coppock
said. "Look at what's happened
with input costs for farmers since
bakingbusiness.com / world-grain.com

mind, we have initiated numerous discussions, not only
domestically within the food
chain, but also internationally
with the grower groups in Canada and Australia to try and coordinate that and try and make
that as smooth a process as it
can be. But understand that
- Daren Coppock, National
we have to get there. It's not
Association of Wheat Growers
a question of if, it's a question
of how and when. That's the
the 2002 farm bill was passed.
course our organization is on."
"The take-home message is that
Mr. Coppock also said NAWG is
while wheat prices have doubled since focused on recruiting more invest2002, the input prices for fuels and fer- ment into wheat.
tilizers have tripled since 2002.
"The number of companies in"Farmers are in for a nasty vesting in wheat research has desqueeze if and when that happens clined," he said. "There are a lot
(prices turn lower)."
who don't have any wheat work at
Mr. Coppock said NAWG has set all any more, and they used to, and
a strategic initiative of increasing we need to fix that. To attract not
wheat yields 20% by 2018, a goal only new varieties and new technolthat may only be achievable if bio- ogy to wheat but also to attract the
engineered wheat becomes a reality. best scientific people into wheat.
"We understand this will not hap"We're going to be about advancpen without biotech in wheat," he ing biotechnology every way we can
said. "That is a given, we are going for the next several years, as long as
to have to get it there. With that in it takes." MBN

'We're going to be
about advancing
biotechnology every
way we can for the
next several years, as
long as it takes.'

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March 11, 2008 / 43

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Milling & Baking News - March 11, 2008

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