Western Canadian Wheat Growers 38th Annual Convention

1
Western Canadian Wheat Growers38th Annual
Convention

• Issues Facing the Milling Industry
• January 25, 2008
• Betsy Faga
• President
• North American Millers Association

2
Membership

• 49 Member Companies
• 30 Associate Member Companies
• Wheat, Corn, Oat, Rye Mills
• 150 cities
•  38 States Canada
• Production exceeds 160 million pounds/day
• More than 95 of total U.S. capacity

3
U.S. Grind
Wheat 900 million bushels Corn 165 million
bushels Oat 145 million bushels
Wheat
Estimated annual grind
Corn
Oats
4
Areas of Activity

• Consumption - Product Promotion
• Legislation Regulation
• International Trade
• Research
• Quality
• Member Education ? Interaction ? Involvement

5
Milling Industry

• 1900 13,188 mills (US)
• 2008 197 mills (US)
• 2008 31 mills (Canada)
• Milling Capitol
• 1900 Minneapolis 130,000 cwt
• 2005 Los Angeles 60,600 cwt
  (Minneapolis 17,500 cwt)

6
Geography

• 2007
• Kansas 136,700 cwt/day
• California 106,600
• Minnesota 101,430
• Pennsylvania 92,040
• Ohio 90,000

7
Wheat Flour SD

• Flour Production Wheat Grind
  
  (1,000 cwts) (1,000 bus)
• 1975 258,985 582,675
• 1985 313,815 700,151
• 1995 388,689 869,296
• 2000 421,270 944,868
• 2001 404,521 914,036
• 2004 393,925 876,047
• 2006 399,860 888,905

8
Wheat Flour Imports

• (1,000 cwt)
  
• 1990 3,392
• 2000 9,666
• 2002 11,291
• 2004 10,726
• 2006 11,740
• Flour Product
• Preliminary

9
Wheat Flour Exports

• (1,000 cwt)
  
• 1990 17,887
• 1995 24,472
• 1996 11,532
• 1999 22,930
• 2004 9,814
• 2005 8,488
• 2006 9,279
• Flour Product Preliminary

10
Whole Wheat Flour Production

• (in cwts)
• 2002-03 7,528,000
• 2003-04 8,240,000 up 10 2.2
• 2004-05 9,934,000 up 21 2.7
• 2005-06 12,510,000 up 26 3.4
• 2006-2007 15,188,000 up 21 4.1
• of total production

11
Milling Production

• Increase in wheat flour production for nine
  consecutive quarters
• 4.6 in Q3 07 compared to Q3 06

Source Census Bureau
12
Per Capita Flour Consumption
13
Per Capita Flour Consumption
Source Dept of Commerce Census of
Manufacturers
14
Rationalization

• 2000-2003 closed 17 mills 128,000 cwts
• 2004-2005 closed 5 mills 36,000 cwts

15
Technology

• Bucket elevator
• Roller Mill
• Bulk Handling
• Pneumatic Conveying
• Electronics - lights out milling

16
Product Promotion

• Grain Foods Foundation

• Wheat Foods Council

• Home Baking Association

17
(No Transcript)
18
Whats Different Today?

• China India - Pricing Demand

19
(No Transcript)
20
(No Transcript)
21
Whats Different Today?

• China India - Pricing Demand
• Tight worldwide wheat stocks
• Collapsing
• Biofuels
• Not good or bad -- just different

22
U.S. TRADE-WEIGHTED DOLLAR INDEX (WEEKLY)
23
CANADIAN DOLLAR INDEX (WEEKLY)
24
Market Chain
Farmers
Consumers
Elevators
Mills / Manufacturers
Retailers
Exporters
High Risk
High

Low
25

• Addressing the Competitiveness Crisis in Wheat
• National Association of Wheat Growers
• North American Millers Association
• U.S. Wheat Associates
• Wheat Export Trade Education Cmte
• June 6, 2006

26
Competitiveness
Farm Policy
Research
Technology
Demand
Efficiency
Transportation Costs
Regulations
Input Prices
Trade Agreements
27
Losing Ground to Competing Crops
28
Crop Yield Increase Comparison 1930 - 2006
29
Restoring Competitiveness

• Wheat Summit unite the industry behind broad
  initiatives
• Domestic Farm Policies
• Domestic Competitiveness
• Research Technology
• Exports, Transportation Infrastructure

30
Biotechnology in Wheat

• Each Sector of the Food Chain
• Must Meet
• Customer Needs

31

• Millers are a Vital Link
• Producers
• Millers
• Bakers
• Food Manufacturers
• Food Service
• Consumers

32
Current Climate

• Corn  Soybeans Feed Use
• Wheat Food Use
• The Staff of Life
• StarLink Corn 
• Prodigene Incident with Plant-made
  Pharmaceuticals
• Bt10
• LLRice610

33
NAMA Position

• Support the science of food biotechnology
• Support the regulatory framework
• Support FDA labeling policy
• Support reaffirmation by US government
• Support BIO stewardship plan
• Support participate in Biotech Working Group of
  Wheat Summit

34
Farm Bill

• Equity in Commodity Program - Market Neutrality
• Conservation Reserve Program
• Funding for Research

35
(No Transcript)
36
Other Issues

• Biofuels
• Energy Groups
• Thickening Border - inspection of all incoming
  commercial transport from Canada
• Food Safety
• Research
• Sustainability

37
Grow Oats!!!

• US Use -- 192 million bushels
• Domestic Production -- gt 94 million bushels
• Imports -- 105 million bushels

38
North American Millers Association
Thank You