Thursday September 19 Ag News

Northeast Nexus campaign receives $250,000 contribution from CVA

One of the Midwest’s largest farmer-owned cooperatives has announced a donation to the Nexus campaign to improve agriculture facilities at Northeast Community College.

Central Valley Ag (CVA) President and CEO Carl Dickinson said the cooperative board of directors has approved a $250,000 investment in the Agriculture and Water Center of Excellence at Northeast.

“Having a college in our community that’s drawing from the right type of people with rural backgrounds, getting them trained up and getting them started and bringing them to us is vital,” Dickinson said. “Not everyone needs a four-year degree,” he continued. “We need people that are trained in trades. We’ve been extremely happy with the students we’re getting out of Northeast.”

CVA, headquartered in York, is a farmer-owned cooperative with locations in Iowa, Kansas, and Nebraska. It provides products and services in grain, agronomy, feed, and energy. CVA has more than 900 employees at its 72 locations, and Dickinson says approximately 20 percent of them were trained at Northeast Community College.

“All of the students that come out of Northeast today come more advanced,” said Chris Carlson, of Wausa, CVA director of sales and a 1997 Northeast graduate. “They’re ready to hit the field. They’ve got a jumpstart on other individuals. They’re more prepared and have a better idea of what’s happening in agriculture today.”

Ed Burbach, of Randolph, the fertilizer operations lead for CVA and a 2013 Northeast graduate, said, “If you are looking to be in agriculture, Northeast is the place to go – and CVA is looking to hire.”

Dr. Tracy Kruse, associate vice president of development and external affairs at Northeast and the executive director of the College Foundation, said CVA has joined a growing list of companies and agriculture organizations investing in the future of agriculture at Northeast.

“CVA is a long-time partner on the College farm,” Kruse said. “They interact with students, bringing real world knowledge to the classroom and the farm field.”

CVA also provides paid internships for many Northeast ag students, Kruse explained.

Funding for the $23 million Agriculture & Water Center for Excellence project is currently being solicited to enhance and expand the agriculture facilities at Northeast Community College.

In addition to the College’s commitment of $10 million, Northeast is seeking at least $13 million in private funds to begin the initial phase of construction, which includes a new farm site with a farm office and storage, a large animal handling facility and other farm structures for livestock operations, and a new veterinary technology clinic and classrooms. The new facilities will be located near the Chuck M. Pohlman Agriculture Complex on E. Benjamin Ave. in Norfolk.

In August, the Acklie Charitable Foundation (ACF) announced a $5 million lead gift to the Nexus project. ACF was founded by the late Duane Acklie and Phyllis Acklie, both Madison County natives and graduates of Norfolk Junior College, a predecessor institution of Northeast Community College.



September Rural Mainstreet Index Bounces Back Above Growth Neutral:  Four of 10 Bankers Report Recessionary Conditions

The Creighton University Rural Mainstreet Index (RMI) for September climbed above growth neutral according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.     

Overall: The overall index rose to 50.1 from 46.5 in August. This marks the third time in the past five months that the overall index has risen above growth neutral.

The trade war with China and the lack of passage of the USMCA (NAFTA’s replacement) are driving confidence and growth lower for most areas of the region.

“Despite a $16 billion federal government support package this year and somewhat stronger grain prices, more than four in 10 bankers are reporting that their local economy is in a recession,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business. 

As reported by Dale L. Leighty, chairman and CEO at First National Bank of Las Animas, Colorado, “Grain prices are (still) a big negative for our customers.”

Farming and ranching: The farmland and ranchland-price index for September slumped to a weak 43.1 from August’s 46.3. This is the 70th straight month the index has remained below growth neutral 50.0. 

The September farm equipment-sales index improved to 35.9 from August’s 30.3. This marks the 73rd month that reading has remained below growth neutral 50.0. “This month bank CEOs were asked to project farm equipment sales in their area. On average bankers expected farm equipment sales to decline by another 7.4% in the next 12 months,” said Goss.

Below are the state reports:
Nebraska: The Nebraska RMI for September rose to 47.6 from August’s 44.4. The state’s farmland-price index slipped to 42.3 from last month’s 43.5. Nebraska’s new-hiring index slumped to 45.2 from August’s 46.8. Over the past 12 months rural areas in Nebraska have lost jobs at a rate of minus 1.4% compared to a stronger 1.6% for urban areas of the state.   Jim Stanosheck, CEO of State Bank in Odell, said, “It doesn't look like Trump's tariffs are going to save the ag economy.”

Iowa: The September RMI for Iowa increased to 48.7 from August’s 46.2. Iowa’s farmland-price index improved to 47.4 from August’s 46.1. Iowa’s new-hiring index for September expanded to 55.5 from 51.8 in August. Over the past 12 months rural areas in Iowa have experienced job additions with a gain of 0.4% compared to a much stronger increase of 1.4% for urban areas of the state.

Each month, community bank presidents and CEOs in nonurban agriculturally and energy-dependent portions of a 10-state area are surveyed regarding current economic conditions in their communities and their projected economic outlooks six months down the road. Bankers from Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming are included.  

This survey represents an early snapshot of the economy of rural agriculturally and energy-dependent portions of the nation. The Rural Mainstreet Index (RMI) is a unique index covering 10 regional states, focusing on approximately 200 rural communities with an average population of 1,300. It gives the most current real-time analysis of the rural economy. Goss and Bill McQuillan, former chairman of the Independent Community Banks of America, created the monthly economic survey in 2005.



August Red Meat Production Down from Last Year

Commercial red meat production for the United States totaled 4.65 billion pounds in August, down 2 percent from the 4.77 billion pounds produced in August 2018.

Prod by State  (mil. lbs.    -    % Aug '18)
Nebraska .....:     739.1            100 
Iowa ............:     723.5            106      
Kansas .........:     462.7             87      

Beef production, at 2.37 billion pounds, was 2 percent below the previous year. Cattle slaughter totaled 2.93 million head, down 2 percent from August 2018. The average live weight was down 6 pounds from the previous year, at 1,338 pounds.

Veal production totaled 6.0 million pounds, 9 percent below August a year ago. Calf slaughter totaled 50,900 head, down 3 percent from August 2018. The average live weight was down 11 pounds from last year, at 205 pounds.

Pork production totaled 2.26 billion pounds, down 3 percent from the previous year. Hog slaughter totaled 10.9 million head, down 3 percent from August 2018. The average live weight was up 1 pound from the previous year, at 279 pounds.

Lamb and mutton production, at 12.6 million pounds, was down 6 percent from August 2018. Sheep slaughter totaled 201,500 head, 2 percent below last year. The average live weight was 126 pounds, down 5 pounds from August a year ago.

January to August 2019 commercial red meat production was 36.0 billion pounds, up 2 percent from 2018. Accumulated beef production was up 1 percent from last year, veal was down 2 percent, pork was up 4 percent from last year, and lamb and mutton production was down 1 percent.



Iowa grocery shoppers strongly support real meat over imitation meat

For the 6th consecutive year, the Iowa Farm Bureau Food and Farm Index® finds that Iowans have a strong affinity for meat and dairy products with more than 9 in 10 (99 percent) saying their households eat meat, eggs or dairy at least weekly. Additionally, only a minority of Iowa grocery shoppers would be likely to buy imitation meat over the real thing, even if presented the opportunity.

The 6th annual survey, conducted online by The Harris Poll, among 502 Iowans ages 20 to 60, with primary or shared household grocery shopping responsibilities, shows which choices and issues may be motivating them to make their food purchasing decisions.

Although plant-based imitation meat options have grown over the years, 94 percent of shoppers still feel real meat is a healthy option, compared to 74 percent who say the same of plant-based imitation meat. Nearly three-fourths (73 percent) of Iowa grocery shoppers say they would not be likely to buy plant-based imitation meat over real meat and two-thirds (68 percent) of respondents don’t think plant-based imitation meat should be able to use “meat” on its label.  After learning more information about the benefits of animal protein in the human diet, three-quarters (72 percent) of grocery shoppers say they are likely to eat even more meat, eggs, and dairy.

That news comes as no surprise to Iowa State University food scientist, Ruth MacDonald, RD, PhD. “Animal protein continues to be important because it is a high-quality or ‘complete’ protein containing all the essential amino acids. Pork, for example, contains one of the highest amounts of protein per serving and provides needed minerals like selenium, zinc, and iron and vitamins B12, B6, thiamin and niacin,” says MacDonald, chair of the ISU Department of Food Science and Human Nutrition.

The strong consumption of Iowa meat, milk and eggs has remained consistent over the last six years of the survey.  More than 8 in 10 grocery shoppers say their households eat beef (86 percent), chicken (83 percent), or eggs (84 percent) at least weekly, 6 in 10 (59 percent) eat pork at least weekly, and more than 9 in 10 (97 percent) consume dairy – cheese (93 percent), milk (87 percent), or yogurt (58 percent) at least weekly.  

The survey also indicates that a small minority of shoppers showing an interest in imitation meat is due to perceived environmental impact. Among those likely to purchase plant-based imitation meat, only a third (34 percent) say this is due to environmental impact. Dr. Frank Mitloehner, an animal science professor at UC Davis, challenges the misinformation about the carbon footprint of livestock in the United States.

“According to the Environmental Protection Agency (EPA), which looks at emissions for the U.S. across all sectors of society including transportation, power production and use, and agriculture, 30 percent of all greenhouse gases are due to electricity production and use, followed by transportation at about 27 percent, and animal agriculture at less than 4 percent,” says Mitloehner. “So all of livestock in the United States accounts for 4 percent.”  Additionally, the National Academies of Sciences found that eliminating all livestock in the U.S. would only reduce greenhouse gas emissions by 2.6 percent.

Iowans Trust Farmers to Care for the Land, Animals and Trusted Source on Food Safety
The survey also shows more than 9 in 10 (92 percent) of Iowa grocery shoppers continue to place trust in Iowa farmers.  Nearly 9 in 10 (87 percent) are confident that Iowa farmers care for their animals responsibly. More than three-quarters (78 percent) say they are confident that Iowa farmers care for the environment responsibly, and 71 percent say they are confident that Iowa farmers are taking on the challenge of improving water quality.

Support for GMOs
The Iowa Farm Bureau Food and Farm Index® again shows positive sentiment towards GMOs with nearly 7 in 10 (69 percent) saying they will continue to eat food they normally do knowing it contains GMOs.  Large majorities of Iowa grocery shoppers say certain GMO benefits would influence their decision to purchase GMO foods: produce food with better nutritional value (74 percent), help feed more people around the world (72 percent), use less herbicide and other pesticides (71 percent), produce food that is scientifically proven over 20 years to be as safe as food produced from conventional and organic crops (66 percent), produce food with better texture or flavor (64 percent), produce better yields to make more efficient use of land (63 percent), and produce food with longer shelf life, to reduce food waste (60 percent).

Methodology
The July 11-July 25, 2019, Iowa Farm Bureau Food and Farm Index® was conducted online within the United States by The Harris Poll on behalf of the IFBF among 502 adults aged 20-60, residing in Iowa who have primary or shared responsibility for household grocery shopping. Figures for age, sex, race/ethnicity, education, and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents’ propensity to be online.



Former Agriculture Secretaries Announce Support for USMCA

Today, all former U.S. Secretaries of Agriculture since President Reagan’s Administration announced support for the United States-Mexico-Canada Agreement (USMCA). In a letter to Congressional leaders, former Secretaries John Block (Reagan), Mike Espy (Clinton), Dan Glickman (Clinton), Ann Veneman (W. Bush), Mike Johanns (W. Bush), Ed Shafer (W. Bush), and Tom Vilsack (Obama) underscored the importance of passing USMCA saying, “We need a strong and reliable trade deal with our top two customers for U.S. agriculture products. USMCA will provide certainty in the North American market for the U.S. farm sector and rural economy. We strongly support ratification of USMCA.” Following the announcement, Secretary Perdue issued this statement:

“President Trump has fulfilled a promise, which many said couldn’t be done, to renegotiate NAFTA and improve the standing of the entire American economy, including the agriculture sector,” said Secretary Perdue. “Support for USMCA crosses all political parties, specifically when it comes to the agriculture community, and I am proud to stand side by side with former agriculture secretaries who agree USMCA is good news for American farmers. I commend President Trump and Ambassador Lighthizer, for their perseverance, leadership, and hard work to get USMCA across the finish line.”

Former Secretaries Vilsack, Glickman, and Block joined Secretary Perdue at USDA today for a press conference to reiterate their support for USMCA. You may watch the press conference by visiting the USDA Facebook page.

To see the letter from Secretaries John Block (Reagan), Mike Espy (Clinton), Dan Glickman (Clinton), Ann Veneman (W. Bush), Mike Johanns (W. Bush), Ed Shafer (W. Bush), and Tom Vilsack (Obama) to Congressional leadership, view the USDA Former Secretaries USMCA Letter.

Background:
USMCA will advance United States agricultural interests in two of the most important markets for American farmers, ranchers, and agribusinesses. This high-standard agreement builds upon our existing markets to expand United States food and agricultural exports and support food processing and rural jobs.

Canada and Mexico are our first and second largest export markets for United States food and agricultural products, totaling more than $39.7 billion food and agricultural exports in 2018. These exports support more than 325,000 American jobs.

All food and agricultural products that have zero tariffs under the North American Free Trade Agreement (NAFTA) will remain at zero tariffs. Since the original NAFTA did not eliminate all tariffs on agricultural trade between the United States and Canada, the USMCA will create new market access opportunities for United States exports to Canada of dairy, poultry, and eggs, and in exchange the United States will provide new access to Canada for some dairy, peanut, and a limited amount of sugar and sugar-containing products.

Key Provision: Increasing Dairy Market Access
    America’s dairy farmers will have expanded market opportunities in Canada for a wide variety of dairy products. Canada agreed to eliminate the unfair Class 6 and 7 milk pricing programs that allowed their farmers to undersell U.S. producers.

Key Provision: Biotechnology
    For the first time, the agreement specifically addresses agricultural biotechnology – including new technologies such as gene editing – to support innovation and reduce trade-distorting policies.

Key Provision: Geographical Indications
    The agreement institutes a more rigorous process for establishing geographical indicators and lays out additional factors to be considered in determining whether a term is a common name.

Key Provision: Sanitary/Phytosanitary Measures
    The three countries agree to strengthen disciplines for science-based measures that protect human, animal, and plant health while improving the flow of trade.

Key Provision: Poultry and Eggs
    U.S. poultry producers will have expanded access to Canada for chicken, turkey, and eggs.

Key Provision: Wheat
    Canada agrees to terminate its discriminatory wheat grading system, enabling U.S. growers to be more competitive.

Key Provision: Wine and Spirits
    The three countries agree to avoid technical barriers to trade through non-discrimination and transparency regarding sale, distribution, labeling, and certification of wine and distilled spirits.



More Time Provided for Dairy Producers to Enroll in DMC Program

The U.S. Department of Agriculture (USDA) today extended the deadline to September 27 for dairy producers to enroll in the Dairy Margin Coverage (DMC) program for 2019. The deadline had been September 20.

Authorized by the 2018 Farm Bill and available through USDA’s Farm Service Agency (FSA), the program offers reasonably priced protection to dairy producers when the difference between the all-milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer.

“More than 21,200 dairy operations have already signed up for DMC, but we’re providing an additional week to help ensure interested producers have time to come into the office,” said Bill Northey, USDA Under Secretary for Farm Production and Conservation. “With smaller margins and increased feed costs, DMC has resulted in almost $230 million in payments disbursed. I know that some farmers may still be cautious given their experiences with former dairy support programs, but producers who have not signed up yet should come into a local office to learn how much money the program can put into their pockets.”

Almost half of the producers who have signed up so far are taking advantage of the 25 percent premium discount by locking in for five years of margin protection coverage. FSA has launched a new web visualization of the DMC data, which is available here.

Margin payments have triggered for each month from January through July. Dairy producers who elect higher coverage levels could be eligible for payments for all seven months. Under certain levels, the amount paid to dairy farmers will exceed the cost of the premium.

For example, a dairy operation that chooses to enroll for 2019 with an established production history of 3 million pounds (30,000 cwt.) and elects the $9.50 coverage level on 95 percent of production will pay $4,275 in total premium payments for all of 2019 and receive $15,437.50 in DMC payments for all margin payments announced to date. Additional payments will be made if calculated margins remain below the $9.50/cwt. level for any remaining months of 2019.

“My message to those dairy producers who are hurting out there: Don’t leave this kind of financial assistance on the table,” said Northey, who announced the deadline extension today as part of a hearing in front of the U.S. House of Representatives Committee on Agriculture. “Producers across the country have told us that DMC is a great risk management tool that works well, and it can work for you, too.”



NMPF Urges Dairy Farmers to Take Advantage of Dairy Margin Coverage Signup Extension

The National Milk Producers Federation is urging farmers to take advantage of a one-week extension in the Dairy Margin Coverage (DMC) program signup deadline to Sept. 27, announced by USDA today.

“Dairy farmers have much to gain by signing up for this program, and another week to take advantage of this benefit can be nothing but helpful for them,” said Jim Mulhern, president and CEO of NMPF. “We urge producers to take advantage of this added opportunity to sign up.”

The USDA said Thursday that more than 21,000 dairy farms have signed up for the new program, the main risk-protection tool for dairy farmers enacted in the 2018 Farm Bill, nearing the level that participated last year in the Margin Protection Program, which DMC replaced. DMC is guaranteed to pay all producers enrolled at the maximum $9.50/cwt. coverage level for every month of production through July, according to USDA data. DMC improvements from the MPP include:
-    Affordable higher coverage levels that permit all dairy producers to insure margins up to $9.50/cwt. on their Tier 1 (first five million pounds) production history, a higher level than previous programs.
-    A 25 percent premium discount for farmers who lock in coverage for the full five years of the program.
-    Affordable $5.00 coverage that lowers premium costs by roughly 88 percent. This creates more meaningful catastrophic-type coverage at a reasonable cost for larger producers without distorting the market signals needed to balance supply with demand.
-    An improved feed-cost formula to better reflect the true cost of feeding dairy cows.



Peterson Credits House Democratic Leadership for Resolving Trade Aid Issue within Continuing Resolution

House Agriculture Committee Chairman Collin Peterson of Minnesota issued a statement Wednesday thanking House Democratic leadership for resolving outstanding issues related to funding available through the Commodity Credit Corporation to aid farmers impacted by the Administration’s ongoing trade war.

“Thanks to the Speaker and the rest of House Democratic leadership for ensuring that farmers can have the certainty this assistance will continue. The call for more transparency in this program is a good one, and I appreciate their willingness to ensure that help gets out the door in a timely manner to the farmers who need it, while at the same time enabling the taxpayer to see where those funds are going.”



Conaway Commends Republican Leaders for Stopping Democrats from Imposing Devastating Cuts to Farmers, Ranchers, Rural America

House Agriculture Committee Ranking Member K. Michael Conaway (TX-11) made the following statement concerning legislation released yesterday evening to keep the government open and requiring that USDA’s CCC be replenished, just as Republicans and a handful of Democrats demanded:

“It’s ironic that as news was released about the budget deal some are implying that House Democratic leadership is somehow to be thanked, apparently for failing to follow through on the threat to do serious harm to rural America. That’s akin to Texans thanking Santa Anna for making Texas a Republic. The good news is the Democrats failed in their effort to use our hard-working farm and ranch families as pawns in their obsessive vendetta against the president."



CHS expands soybean crush and production capacity

CHS Inc. today announced plans for a significant renovation at its Fairmont, Minn., soybean processing plant. The expansion will increase market access for regional soybean growers and return value to its owners through increased production of high-demand soy-based food and feed ingredients.

"CHS is always looking for ways to expand market access for farmers' crops and improve operational efficiencies. This renovation project will deliver value on several fronts," says Scott Erdal, director, risk management and business development. "The processing expansion and improvements will allow CHS to grow market access, add value to our owners, capitalize on consumer demand for protein and ensure continued safe operations for our employees and the communities where CHS does business."

The operational and safety improvements will increase the Fairmont plant's soybean crush and soybean oil production capacity, enhance product quality and optimize production at the CHS soybean refinery at Mankato, Minn.

Soybeans grown by area farmers are processed into oil at the Fairmont facility and transported to the Mankato processing plant for further refining. CHS Processing and Food Ingredients serves food and feed ingredient companies across the U.S. and many export destinations.

"Regional livestock expansion has created new demand for quality soybean meal. This project will increase crush capacity at Fairmont and help us optimize our Mankato soy crush and refining platform," Erdal says.

Construction is underway, and completion is expected by fall 2021.



Farm Foundation Announces New President and CEO

Farm Foundation is pleased to announce that Shari Rogge-Fidler will be joining the organization as president and CEO. Rogge-Fidler brings a breadth of executive, academic and managerial experience in production agriculture, business management, national and international finance, conservation and soil health issues. These skills align well with the varied and important work of the Farm Foundation. "We are very excited to have Shari join the Farm Foundation in this leadership role," says Farm Foundation Board of Directors Chair Larkin Martin. "Her track record of strong leadership, combined with her deep agricultural knowledge makes Shari uniquely qualified to lead the Farm Foundation into the future."

Rogge-Fidler is a fifth-generation farm owner from Nebraska, who began her career in London in financial services and then with the Boston Consulting Group. She and her family launched and grew a branded gourmet organic food company, where she was vice president of sales and marketing. She was president of Cambium Strategies, LLC, a company focused on helping food and agriculture organizations navigate secondary growth. At Cambium Strategies, she led diverse teams working on projects with ag-tech firms, as well as a multi-crop supply chain project in Ethiopia and a soil health strategy for large global NGOs. She was also interim CEO at Applied GeoSolutions, LLC, focusing on commercializing its geospatial decision tools for agriculture and soil health purposes. Most recently, Rogge-Fidler was CEO of Family Farms, LLC, serving approximately 1,000 farms across the U.S. and Canada.

"I'm thrilled to be joining the Farm Foundation," says Rogge-Fidler. "I have a real passion for food and agriculture. I look forward to the opportunity to help Farm Foundation grow-and to join an organization that does important work in the agriculture and food sectors, convening diverse groups of experts to work on important issues facing a wide variety of stakeholders."

Rogge-Fidler received her MBA from Harvard Business School and her Bachelor of Science degree in business administration from the University of Kansas, with an emphasis on international finance. She will assume the Farm Foundation role on Sept. 30 and will be based out of the Chicago office.

"Shari is a talented executive and thoughtful leader. It's exciting to have someone with her wide range of experiences joining the Farm Foundation team. We look forward to a bright future for the organization under her leadership," says Martin.



New Study Stresses Ethanol’s Benefits for Energy Security

A new study shows that the Renewable Fuel Standard not only saves drivers money at the gas pump every day, but also enhances energy security by greatly reducing or even eliminating the blow to our nation’s drivers when global oil production is disrupted. The analysis confirms that the growing supply of ethanol significantly helps dampen gasoline price shocks that result from sudden oil market disruptions. If renewable fuels were removed from the fuel supply, gas prices would be more than $1 per gallon higher, the study found.

With gas prices now rising because of the recent attacks on Saudi oilfields, this research is especially relevant today, noted Geoff Cooper, President and CEO of the Renewable Fuels Association.

“This research underscores what should be common sense: We need a diverse domestic fuel supply for real U.S. energy security,” Cooper said. “We can avoid unnecessary price spikes at the pump by incorporating more renewable fuels into the nation’s fuel supply and ensuring that healthy competition exists in the marketplace.”

The study, by independent economist and energy expert Dr. Philip K. Verleger, Jr., looks at oil market disruptions over nearly 50 years and provides an example in which the availability of ethanol avoids a significant impact to U.S. gasoline prices from a supply disruption.

“Retail prices would today be above $4 per gallon, not $2.90, were renewable supplies removed from the supply mix,” Verleger writes. “The lower gasoline prices, in turn, allowed consumers to spend more on the things they wanted rather than motor fuels. ... The economic benefit of lower gasoline prices that is directly attributable to the availability of renewable fuels adds one to two percentage points to the U.S. GDP every year.”

Dr. Verleger catalogs various crises and their impacts on the oil supply, from the 1973 Arab Oil Embargo to ongoing political and economic challenges in Venezuela. This week’s attack on Saudi Arabia, which took place after this report was prepared, are estimated to affect 5 percent of the daily global oil supply. When it comes to crises such as these, Verleger asserts that even “a modest amount of renewable fuels can significantly moderate the price impact of market disruptions.”

The study incorporates and builds upon a May report by Dr. Verleger that found the RFS lowered gas prices by an average of 22 cents per gallon from 2015-2018, saving the typical American household $250 annually.

Finally, Verleger looks at how the competition in the fuel marketing sector, together with the availability of renewable fuels, acts as a counterbalance to the impact of refinery consolidation on supply and pricing. “Consumers would likely pay even higher prices if the mergers that created the large oligopolistic independent refiners had not been accompanied by a second trend: the creation of an aggressive, competitive petroleum marketing sector,” Verleger writes.



Taiwan Goodwill Mission Signs Letter of Intent for U.S. Wheat Purchases

Representatives from the Taiwan Flour Millers Association (TFMA) signed letters of intent to purchase wheat and other U.S. grown commodities over the next two years Sept. 18, 2019, at the U.S. Capitol. The millers are part of a biennial Taiwan Agricultural Trade Goodwill Mission demonstrating Taiwanese consumer preferences for high quality U.S. agricultural products. The wheat delegation members first stopped in Portland, Ore., Seattle and Idaho before travelling to Washington, D.C., for events. They will also visit Oklahoma and South Dakota to meet with farmers, grain handlers and state officials.

Mr. Yi-Chuen “Tony” Shu, Executive Director of TFMA and President of Formosa Oilseed Processing Co., Ltd., the parent company of Top Foods Flour Mills, signed the wheat letter of intent along with U.S. Wheat Associates (USW) President Vince Peterson. The letter states that TFMA intends to purchase a total of 1.8 million metric tons (equivalent to 66.1 million bushels) of U.S. wheat between 2020 and 2021. The value of these purchases is estimated to be around $576 million.

“We have long had mutually beneficial trade relations with the Taiwan milling and flour products industry,” Peterson said. “U.S. wheat farmers pioneered the market more than 60 years ago by meeting with members of the developing flour milling industry. One innovative plan involved those flour millers donating the equivalent of $1.00 for every one metric ton of imported U.S. wheat to a wheat foods foundation that eventually established what is today the China Grain Products Research & Development Institute. The members of TFMA continue to be reliable trading partners that fully recognize the value of purchasing quality U.S. grown wheat.”

The Republic of China, known as Taiwan, is on average the eighth largest market for U.S. wheat. TFMA imports wheat on behalf of all 20 Taiwanese flour mills and has imported far more wheat from the United States compared to other origins. 

Today, the Taiwanese people consume more wheat flour per capita than rice. Significant hard red spring (HRS) imports reflect a need for strong gluten flour for breads, rolls and frozen dough products as well as for blending with hard red winter (HRW) to make traditional Chinese flour foods and noodles. Year-to-date sales to Taiwan in marketing year 2018/19 (June to May) are up 11% from 2017/18. Imports of soft white (SW), including Western White (a blend of SW and up to 20% club), help meet growing demand for cake, cookie and pastry flours.

USW and its legacy organization Western Wheat Associates have maintained an office in Taipei for 53 years.