12 CapitalPress.com
May 6, 2016
Wheat
also examines 4,500 breeding
samples each year, measuring
more than two dozen attri-
butes, passing along results to
wheat breeders.
“That huge amount of
work culminates in releasing
two or three varieties each
year,” Morris said. “It’s in-
teresting to consider the per-
spective of 95 percent of what
we do is just to throw things
away.”
CONTINUED from Page 1
the needs of customers will
set it apart from other wheat
grown around the world.
Last year, farmers in Ida-
ho, Oregon and Washington
produced nearly 239 mil-
lion bushels of wheat, ac-
cording to the USDA 2015
small grains summary re-
port. About 80 percent of
that was sold overseas. In
Eastern Washington, even
more wheat goes overseas
— about 90 percent, accord-
ing to the Washington Grain
Commission.
The U.S. competes in the
global market against other
wheat-producing countries,
including Canada, Austra-
lia and the Black Sea region
that includes Ukraine and
southern Russia. Some of
that wheat is cheaper, and
some of it is closer to the
countries looking to buy, re-
ducing transportation costs.
“We can’t compete with
freight costs and price,”
Miller said. “(Quality) is all
we’ve got. That’s our true
advantage.”
Miller, who farms about
60 miles southwest of Spo-
kane, is chairman of the
Washington Grain Commis-
sion and secretary-treasurer
of U.S. Wheat Associates,
which promotes U.S. wheat
overseas. He recently re-
turned from visiting buyers
in Japan, Taiwan and South
Korea.
Miller said the customers
he met made it clear they
hope the high quality of Pa-
cific Northwest wheat con-
tinues.
“They are just making
us very aware that we don’t
jeopardize that,” Miller
said. “If it drops down to
where the other competitors
are, we’ve lost our competi-
tive edge.”
Ingredients for
success
Perhaps “quality” is bet-
ter defined as “suitability”
to how the wheat is used,
said Craig Morris, director
of the USDA Agricultural
Research Service Western
Wheat Quality Laboratory.
For example, a wheat
breeder’s best hard red
spring wheat variety may
be completely unsuitable
for making Japanese sponge
cakes, he said. But for mak-
ing some types of bread, it
may be just right.
“Understanding
what
our customers want, what
is best-suited for their prod-
ucts, and then using our
knowledge and experience
to translate that into dis-
crete, technical, well-de-
Supply grows
Photos by Matthew Weaver/Capital Press
USDA Agricultural Research Service Western Wheat Quality Laboratory Director Craig Morris holds up an example of a good-quality
cookie made using Pacific Northwest wheat April 8 in Pullman, Wash. Wheat farmers promote the quality of their wheat when selling it to
customers overseas.
Farmer Mike Miller examines his wheat April 20 on farm property
near Ralston, Wash. Wheat farmers in the region and across the
country promote the quality of their crop when selling it to custom-
ers overseas.
fined criteria we can mea-
sure and communicate with
wheat breeders” is crucial,
he said.
Many international buy-
ers seek out U.S. wheat
because the value is high-
er compared to wheat
from elsewhere, said Steve
Wirsching, vice presi-
dent and director of U.S.
Wheat’s West Coast office
in Portland.
Soft white wheat and club
wheat — a subclass of soft
white — are primarily grown
in the Pacific Northwest and
considered the perfect ingre-
dients for Japanese sponge
cakes and cookies.
“Wheat breeders in the
PNW have worked for gen-
erations to breed varieties
that meet the Japanese spec-
ifications for sponge cake
and the reward is that this
wheat is selling for a pre-
mium this year,” Wirsching
said.
According to the USDA,
soft white wheat sells for
$5.28 to $5.40 per bush-
el and $5.50 to $5.75 per
bushel for the maximum
10.5 percent protein at the
Portland market, compared
to $5.19 to $5.34 per bushel
for hard red winter wheat.
Many customers expect
higher value from the U.S.,
said Jim Peterson, market-
ing director at the North
Dakota Wheat Commis-
sion and chairman of U.S.
Wheat’s quality committee.
Quality is the primary
consideration in markets
such as Northern Asia, parts
of Europe, Central America
and Mexico, and to a less-
er extent in other regions,
particularly price-sensitive
markets, Peterson said.
Reward for quality
Farmers might not imme-
diately see a higher price for
quality, said Morris.
“If I grow a better quali-
ty variety versus something
down at the bottom (and)
take a truckload of each to
the elevator, is there any price
differential?” he said. “Proba-
bly not. So am I getting paid
for quality? It would appear
not. But if I sell a shipload of
PNW wheat and not only do
PGG
Harvest
CONTINUED from Page 1
to get tighter,” said Ken Bai-
ley, vice president of Orchard
View Farms in The Dalles,
Ore., that state’s largest cher-
ry grower.
On May 2, Jason Vargas,
30, was second in line and
waited more than two hours
for Stemilt’s job fair to open
at the Wenatchee Conven-
tion Center. The line grew
to only about 80 when the
doors opened early at 1:30
p.m. and just 40 applications
were received in the first half
hour.
Some 492 applications
had already been received by
Wenatchee WorkSource, the
local job office of the state
Redefining quality
Each year, the three Pa-
cific Northwest wheat com-
missions release a preferred
variety brochure, ranking the
quality of the available wheat
varieties from Most Desirable
to Least Desirable.
“If two varieties have the
same agronomic character-
istics, we encourage them to
choose the one with the high-
er quality,” said Glen Squires,
CEO of the Washington Grain
Commission.
The commissions are also
considering a redefinition of
the rankings to more clearly
differentiate them. Chang-
es were made for soft white
winter wheat for the 2016
brochure. The commissions
are considering changes in the
other classes.
Blake Rowe, Oregon
Wheat CEO, said the com-
missions are raising standards
so wheat breeders can aim for
higher ratings for the varieties
they develop.
“There’s always room to
try and make the product a
little better than what else is
co-op to put its profitable divi-
sions up for sale. By selling off
businesses such as the grain
division, energy and Precision
Rain irrigation subsidiary, the
board wants to ensure those
services remain intact under
new ownership. PGG has 67
employees, most of which
Jacobson said would at least
be offered the chance to keep
their jobs.
“These are all profitable
businesses,” said Jacobson,
who was hired at PGG in 2012.
“We’ll get those sold.”
The first order of business,
Jacobson said, is to close the
deal with United Grain Corpo-
ration, an outfit owned by the
Mitsui Group of Japan. United
Grain has traditionally been
one of the West Coast’s top
exporters, and is now expand-
ing its reach to work directly
with farmers.
Tony Flagg, vice president
of business development, said
he couldn’t discuss terms of a
deal with PGG, but looks for-
ward to establishing roots in
the region.
Department of Employment
Security.
The job fair generated 550
applicants last year, 747 in
2014, 960 in 2013 and a re-
cord 1,546 in 2010. A Stemilt
spokeswoman at the time
credited the turnout to high
unemployment during the re-
cession. That was a two-day
event at which the opening
line wrapped halfway around
the convention center.
This was the first year ap-
plicants could turn in appli-
cations at WorkSource, by-
passing the fair. In time that
may replace the fair but Zach
Williams, Stemilt’s director of
human resources, said the fair
is kept to generate interest and
applications.
Stemilt advertises its jobs
through its website, Work-
Source, newspaper and radio
advertisements and, for the
first time this year, Facebook.
Stemilt needs 1,500 work-
ers for its two cherry packing
plants running double shifts at
the height of packing. About
half of those will be temporar-
ily pulled from apple packing,
Williams said. The other half
was to come from the fair. If
Stemilt gets more than 750
applicants it will hold them
in reserve as replacements for
what can be high turnover be-
cause of the tedious nature of
sorting.
The amount of sorting by
humans is being reduced by
faster, high-tech optical sort-
ing and sizing equipment by
many companies.
Orchard View Farms is
just finishing installation of
a new, high-tech Unitec line.
The company has nearly
2,400 acres of cherries. The
company needs 450 to 500
pickers and 175 to 180 sorters
and packers and starts recruit-
ing in March, Bailey said.
Orchard View had about
40 percent of a normal crop
last season due to a November
2014 freeze. It hopes to have
a full crop this year with pick-
ing estimated to start June 3 or
4 compared with May 29 last
year.
Some Yakima companies
struggled last year to get
enough sorters and packers,
and growers are always look-
ing for more pickers, said
Tommy Hanses, operations
manager at Washington Fruit
& Produce Co. in Yakima.
“We’re in good shape.
CONTINUED from Page 1
show PGG lost approximately
$4.4 million in 2013 and $7.9
million in 2014. General Man-
ager Rick Jacobson said the
co-op needed at least 8 mil-
lion bushels from last year’s
harvest to maintain its invest-
ments, but came nowhere
close to meeting that goal.
On the other hand, neigh-
boring Morrow County Grain
Growers earned a profit of
$321,315 last year, with
$207,584 in patronage and eq-
uity paid to members. North-
west Grain Growers, based in
Walla Walla, also made $4.4
million for the year ending
April 30, 2015.
At Monday’s meeting, the
PGG board recommended
dissolving, which allows the
I sell that ship, but the price
is so many dollars per metric
ton over Black Sea (wheat),
have I gotten paid for quality?
I would argue yes, in some
sense you have.”
The marketplace builds in
premiums and discounts as a
way of differentiating value,
Morris said. He argues that
Pacific Northwest wheat has
higher value and should com-
mand a higher price.
Farmers could receive a
higher price on a per-truck-
load basis for easily measured
kernel traits such as protein,
the falling number test, mois-
ture, test weight or on a re-
gional or class-specific basis,
Peterson said.
EO Media Group
Members of the Pendleton Grain Growers cooperative voted Mon-
day to dissolve the co-op. In recent years, the co-op lost millions
of dollars in profit and misrepresented millions more in overstated
earnings.
available on the marketplace,”
Rowe said.
Growers have always been
interested in quality, said
Blaine Jacobson, executive
director of the Idaho Wheat
Commission, but now more
tools are available to help
them grow wheat that meets
the more precise standards
buyers seek.
“The science regarding
the chemistry of wheat has
advanced, and so many of
our customers are becoming
much more specific in the
type of wheat they need for
their product,” he said.
If a variety is released and
is negatively ranked, it can
potentially create problems,
said Squires.
In the early 2000s, the
hard red winter variety Estica,
slated for use in Europe, had
high yields but poor quality.
Japanese customers received
a shipload of the variety, but
couldn’t use it and refused to
buy it, so the export company
asked farmers not to grow it,
he said.
“If you grow really poor
quality, it’s going to nega-
tively affect that market, and
that’s what we want to stay
away from,” Squires said.
There aren’t presently
many low-quality wheats
like that in the PNW market,
Squires said.
“We want to keep it that
way,” he said.
High quality is becoming
even more important as farm-
ers around the globe are pro-
jected to raise a record 26.9
billion bushels of wheat this
year. Combined with a strong
U.S. dollar relative to foreign
currencies, such a large sup-
ply means lower wheat prices
for U.S. farmers.
“Last year, the planet Earth
grew more wheat than the
planet has ever grown,” Mor-
ris said.
And more is on the way.
Competing countries in the
Black Sea region haven’t yet
reached the limits of wheat
production, Morris said.
“Currently, is it high-qual-
ity wheat? Absolutely not,”
Morris said. “Is it cheap? Ab-
solutely. Even though we’re
super-efficient and super-pro-
ductive, I don’t know that the
U.S. farmer is going to be able
to compete, or that we want to
compete, on the global stage
by producing the cheapest
wheat possible.”
The future
Craig Morris stood in a
room filled with about 1,500
flour samples, milled from
wheat grown in 2015. Each
one represented a variety that
could eventually be released
to Washington wheat growers.
The Western Wheat Quali-
ty laboratory, on the Washing-
ton State University campus,
As he moves up the leader-
ship ranks of the U.S. Wheat
Associates hierarchy in the
next few years, Miller expects
quality to continue to be one
of the main topics.
“It’s a very important topic
we have to work through, be-
cause of the competition for
acres as well as for markets,”
he said. Growers elsewhere in
the United States could elect
to raise corn or soybeans.
Peterson expects demand
to remain steady in countries
that already demand high
quality, and increase in coun-
tries where the middle class is
expanding. Middle class con-
sumers want a larger variety
of wheat products or quicker,
more convenient ways to pre-
pare them, he said.
Asked who produces
the next-best wheat quality,
Squires, of the Washington
Grain Commission, said every
country is a potential compet-
itor, even in the Black Sea re-
gion, where farmers are slow-
ly making improvements.
“Everyone is improving
their quality,” he said. “Qual-
ity wheat tends to bring in a
higher return. That’s why
we’ve got to stay ahead of the
game.”
“We want to do business
with producers, not middle-
men,” Flagg said. “We think
it’s better for both.”
Meanwhile, PGG mem-
bers won’t see any dividends
returned to them for possibly
three to six years. Some, such
as Eric Anderson, have doubts
they’ll see any money at all.
Anderson, who’s been a
member of the co-op for 40
years, described the mood at
Monday’s meeting as one of
resignation. He said he and
his wife have $36,000 worth
of lost dividends from PGG,
and they’re far from the only
ones. Missing those payments
is especially difficult for se-
niors, Anderson said, who
have counted on that income.
“These directors took it
from their neighbors,” Ander-
son said. “It’s their neighbors’
money.”
As for seeing any equity
returned, Anderson said it’s a
steep climb for a co-op that
still has pension obligations,
environmental liabilities and
a $15 million loan from Co-
Bank left to pay back.
“I hope there will be sig-
nificant recovery,” he said.
“But they’ve not given me
much incentive (to believe).”
Jacobson said CoBank has
not called on PGG’s loan and
has been supportive through
the process. He understands
some people are angry, but
that “it serves no purpose to
find a scapegoat.” Jacobson
also defended the board, say-
ing they’ve been transparent
reporting what they knew
about the co-op’s finances.
Jacobson said he has an
idea of how much equity will
be returned to members, but
would not specify.
We just transfer apple people
over for packing and our new
(high-tech) cherry line (start-
ing its third season) helps re-
duce the amount of hand sort-
ing,” Hanses said.
Zirkle Fruit Co., Selah,
starts hiring in late winter and
early spring for June and July
cherry packing.
“It’s been slow, but I think
we’ll be adequate,” said Mark
Zirkle, company president.
The company is complet-
ing a new Compac high-tech
cherry line just in time for the
season. Zirkle said without it
he would be concerned.
“We just don’t have the
numbers (packing applicants)
we use to,” he said. More peo-
ple want to pick but still the
Columbia Basin could be a
little short on pickers, he said.
Pickers generally make
more money on piece rate
than packers at minimum
wage.
Norm
Gutzwiler,
a
Wenatchee grower, said he
thinks there will be a picker
shortage on the front end of
the crop.
“California will finish
ahead of Washington so pick-
ers should move up, but we
don’t see as much migrant
movement as we use to,” he
said.
Despite a nice bloom, no
frost and good pollination
weather, the crop just didn’t
set up well, Gutzwiler said.
“It won’t be a record
crop. It will probably be very
similar to last year but there
should be a lot of nice-size
fruit for the market,” he said.
Increasing quality