Japan reduces club percentage in western white wheat tenders
Farm and Ranch December 10, 2009 Very tight supplies of club wheat and the subsequent high price premium for it, has led several importers to switch to straight soft white wheat from western white, which is a blend of soft white and club. However, the major buyer of Pacific Northwest club wheat, Japan, is still purchasing western white but with a reduced percentage of club. Tom Mick CEO of the Washington Grain Commission says the Japanese are concerned because their domestic crop was short and the country will need to increase imports by 200-thousand tons. Mick: “So through two months of very intense negotiations and the Washington Grain Commission sending our vice president Glen Squires to talk to them about this. It was decided that to assure our number one customer of a steady supply that they would drop their club percentage from 20% to 10% and that went into effect two weeks ago. So we hope that by lowering that requirement we can meet their needs, their increased demand needs until new harvest becomes available.” The question will be whether once new crop club is available, will Japan go back to a 20 percent club requirement in western white? At one time Japan had a 25 percent club requirement, which it cut back during a time of tight club supplies and never went back to. Japan’s recent reduction from 20 percent to ten percent didn’t affect the premium for club over soft white, which is still running at about $3 a bushel. I’m Bob Hoff and that’s the Northwest Farm and Ranch Report on the Northwest Ag Information Network. ?
