North American challenge to Asian needle market

The US Department of Agriculture will pump about $35 million over the next two years into an incentive program for US white wheat production. The goal is to increase the amount of non-feed hard white wheat produced in the US in 2003-05 crop years. Growers could earn production incentives of $0.20 per bushel, and $2 per acre for each acre planted to certified seed.

The incentives are expected to increase supplies of consistent quality product, mostly so that exporters can compete in markets in Southeast Asia where white wheat is preferred for making noodles.

Also, the Canadian Wheat Board (CWB) has signalled its intentions to capture some of the lucrative Asian noodle market away from Aussie producers. CWB will launch a new hard white wheat in the Canadian fall, with expectations that Canadian growers will produce 200,000 tonnes of the wheat in season 2003-04.

Despite Australian marketing advantages to the Asian market, CWB says that it hopes to edge away Australian sales, with the threat to local growers not only centring on a loss of market share, but also a potential reduction in the premiums achieved from these markets for hard white wheat.

By 2008-09 the CWB forecasts production of approximately 2 million tonnes of the new hard white wheat, provided growers adopted the variety, prices remain attractive, and consumers accept the Canadian-grown wheat.