By Kent Kupfner — Terry Angvick, Montana Wheat and Barley Committee (MWBC) District 1 director, and Kent Kupfner, MWBC executive director, recently joined Montana Governor Greg Gianforte on a trade mission to Taiwan. Participants from the agriculture delegation included representatives from the Montana Department of Agriculture, Montana Grain Growers Association, Montana Farm Bureau Federation, Montana Stockgrowers Association, Stricks Ag and CHS, Inc. While in Taiwan, we were accompanied by staff members from the American Institute in Taiwan (AIT), the Montana Asia Trade Office, US Wheat Associates (USW) and US Grains Council (USGC).
JAM PACKED AGENDA
The weeklong agenda was jam packed and provided the opportunity to meet with various groups ranging from the Taiwan Flour Miller’s Association (TFMA) to the AIT, which works to facilitate business between the United States and Taiwan. A visit to the AIT offices (with similar functions as a US embassy, but not formally recognized as an embassy given the unofficial ties between the US and Taiwan) allowed the group to hear a market briefing given by Foreign Agricultural Services on trends in the Taiwanese marketplace. In terms of national security, we learned that their island of 23.5 million people relies upon a figurative “silicon shield” driven by the sheer size, strength and global dominance of Taiwan’s massive semiconductor industry. Some might be surprised to learn that Taiwan has an abundance of media—it happened to be their election season during our visit. The Taiwanese government has a goal of a bilingual population (Mandarin and English) by 2030. Personal incomes are already high, but the Taiwanese population has peaked and is trending lower as the country is faced with one of the lowest birth rates in the world.
TFMA & US WHEAT ASSOCIATES
The MWBC and US Wheat Associates (USW) were fortunate to host a luncheon for the TFMA. Following welcoming remarks from Governor Gianforte and TFMA Chairman Tony Shu, I presented an overview of the wheat trade between our two countries. It was important to cover the MWBC mission including research-related priorities, market development activities, trade team visits and historical trade volumes. I discussed information related to Montana weather, small grain acreage and production trends, including highlights of the 2023 wheat crop with its much-improved yields and excellent milling quality characteristics.
Taiwan is a loyal and consistent buyer of US wheat and is currently our fourth-largest buyer. Given the country’s extremely limited domestic production, annual purchase volumes are approximately 1.3 million metric tons (47.8 million bushels). Year-over-year, 80 to 90 percent of this wheat volume originates in bulk vessels of US origin, with the balance primarily shipping in containers from Canada and Australia.
TFMA was founded in 1952 and currently includes 15 active members with flour mills located throughout the country. The TFMA procurement group is responsible for more than 98 percent of all US wheat imports which includes three classes: hard red spring, hard red winter and soft white winter. Hard red spring represents the largest portion (56 percent), followed by hard red winter (33 percent) and soft white winter (11 percent). A high percentage of the hard wheat bushels are produced by Montana’s wheat farmers.
Taiwan is one of the most quality driven buyers in the world, with some of the most challenging specifications for exporters to meet. TFMA purchases guaranteed 14.5 percent protein dark northern spring (DNS), which must be a minimum 75 percent DHV. Hard red winter must be a minimum 12.5 percent protein.
I was able to reconnect with several members of the trade team who visited Montana in June. It was awesome to greet, shake hands, and thank our Taiwanese wheat customers in their home country! Christy Clark, Montana Department of Agriculture director, concluded the networking luncheon with closing remarks, a gift exchange and photos.
CHINA GRAIN PRODUCTS RESEARCH & DEVELOPMENT INSTITUTE
Our group was treated to a courtesy visit and tour of the China Grain Products Research & Development Institute which is an organization that invites millers, bakers and food companies to collaborate on food projects. Students receive bakery training and work to develop new food products to diversify diets and improve health. We were given a thorough facility tour and the opportunity to learn about new flour innovations utilizing Montana wheat. Even though the Taiwanese government encourages a diet with rice, the per capita consumption of wheat has been steadily growing since the early 1970s, while per capita rice consumption has fallen dramatically during the same time period. Wheat consumption began to exceed rice starting in 2008.
TOP FOOD INDUSTRY & TAICHUNG PORT TOUR
The new Country Director of USW, YI-I Huang, and his staff helped coordinate and joined the ag delegation for a visit to Top Food Industry Corporation and a tour of Taichung port facilities. At the Taichung port, we were able to see firsthand where inbound ocean vessels are unloaded at a public berth and moved into a massive grain terminal. Most of Taiwan’s flour mills are in the central portion of the island, so wheat is moved from the port facilities throughout the country via truck and rail.
Established in 2004 by Formosa Oilseed Processing Company, Top Food is in the Taichung port industrial park. Top Food imports high quality wheat from the US, Australia and Canada. The company utilizes the most advanced milling equipment from Buhler and employs a professional flour making staff. The company produces 200 types of flour at a rate of 1,000 tons per day. The research and development team has years of experience in food processing and strives to continuously understand and meet customers’ needs. With product lines sold nationwide, they have earned the trust and confidence of many well-known customers in the Taiwanese food industry. Incidentally, a representative from Top Food visited Montana in June as part of a trade mission. Our visit to the Taiwanese mill gave me the chance to get reacquainted and thank them for their continued purchases of Montana wheat.
MONTANA APPRECIATION RECEPTIONS
A visit with the Ministry of Foreign Affairs, the delegation’s official Taiwanese government host, highlighted the formal Montana-Taiwan relationship and vital importance of our continued commitment to free trade. In addition, a reception was held at the Director of AIT’s residence to acknowledge several longstanding trading relationships between Montana and Taiwan. Agents who help facilitate the cash wheat trade between TFMA and companies such as United Grain Corporation (UGC) and Columbia Grain International (CGI) were also in attendance. Commercial grain companies such as CHS, UGC and CGI are integral to the successful execution of contracts for wheat cargos. MWBC was appreciative of the chance to meet the agents and thank them for all their hard work.
RELIABLE AND CONSISTENT CUSTOMER
Much like Japan, Korea and China, the population of Taiwan is aging rapidly, and the working age population is declining. This suggests that the growth in wheat consumption is leveling out and driving changes in consumer preferences. The Taiwanese consumer is very quality conscious; health and nutrition considerations such as “clean labels” with fewer additives are important. The consumer is willing to pay a premium for quality and this leads to higher prices paid for Montana wheat.
The Taiwanese rolled out the red carpet for the team from Montana and we are very grateful for their efforts. Taiwan represents a very reliable and consistent market for high quality wheat, particularly wheat grown in Montana, and we are thankful. Montana’s wheat growers and the grain industry remain committed to meeting this demand on a reliable and consistent basis.