The Oklahoma Wheat Commission hosted a Chilean trade delegation last week in Southwest Oklahoma. This delegation sought information to understand all levels of the marketing chain of the Southern Plains region of the US, particularly looking at locations to source Hard Red Winter Wheat. The group was greeted at Will Rogers Airport and then toured locations in Southwest Oklahoma, on Thursday, July 27th, with meetings held at Cenex, Harvest States in Frederick, Oklahoma.
A lunch meeting followed at Museum of the Plains in Altus, with Farmrail Corporation, presenting transportation and logistic routes for sourcing grain in regions of Southwest Oklahoma. After lunch members of the group toured Muller Farms with Matt and Kellie Muller discussing crop rotations with wheat and cotton production.
The delegation then met in Headrick, Oklahoma at a loading facility operated by Co-Mark Equity, with discussions on sourcing from other locations that included Coop Services, Lawton, OK and Planters Coop, Lone Wolf, OK. Discussions were held on wheat quality data from this region and outlook for market potential for this coming year.
The group wrapped up the day with a trade dinner hosted by the Oklahoma Wheat Commission and Oklahoma Wheat Growers Association in Medicine Park, OK. A Memorandum of Understanding was entered into by the Chilean Millers, the Oklahoma Department of Agriculture, Food and Forestry, (ODAFF) the Oklahoma Wheat Commission (OWC) and Oklahoma Wheat Growers Association (OWGA). It was signed by Oklahoma Secretary of Agriculture Blayne Arthur, ODAFF; Miguel Galdos, USW Wheat Offices in Santigo, Chile; Michael Peters, OWC Board Member and current President of US Wheat Associates, Okarche, OK; and Keeff Felty, OWGA board member and current Vice-Chairman, National Association of Wheat Growers, Altus, OK. Read the MOU by scrolling to the bottom of this story.
Chile’s wheat imports range between 1.0 to 1.3 million metric tons per year, which is around 42.25 million bushels of wheat. Of those imports the US market share is usually between 20% to 40%, which ranges from 8 million to 16 million bushels of grain purchased from the United States. Factors that impact purchases of US wheat from Chile often depend on Argentine and Canadian wheat prices. The US exported 256,684 metric tons in 2022 which amounted to a little over 9.4 million bushels of wheat purchased from US wheat producers by this region. This amount was 19% higher than in 2021. Chile has purchased combined cargoes of Hard Red Winter wheat from the Gulf and Soft White wheat from the Pacific Northwest, as well as purchases of Soft Red Winter wheat from Atlantic ports depending on price opportunities.
Total wheat consumption (including food, seed and industrial use) has been relatively flat for several years at about 2.1 to 2.4 million metric tons per year. Chile is not a significant wheat exporting country as they are limited on excess wheat grown from their region, therefore they look to Argentina, the US and Canada for wheat to imports to feed their citizens. Flour use in this region is estimated to be 76% for bread, 10% for pasta, 5% for cookies/crackers/confectionary and 9% for animal feed. “Regular bread” is sold in bulk in every bakery in the country. Sub categories are “marraqueta”, a French style bread and “hallulla”. Chile has 68 mills located primarily in the central area, with an installed milling capacity of 2.9 million metric tons of wheat per year. Chile’s annual per capita bread consumption of 90-93 kg is the highest in South America region. Major wheat milling companies are San Cristobal and Cunaco, each with 25-28% of total wheat imports, and Grupo G9, a wheat purchasing agency with eight member mills, with 30-35% of total imports.
Representatives on the delegation from Chile included:
José Vargas, Molinos Cunaco, Finance Manager
Andrés Bustos, Molinera San Cristobal, Operation Manager
Javier Heredia, Heredia Molinos, Executive Director
Rafael Thomas, Importadora de Granos G9, General Manager
Jose Grohnert, Molino La Estampa, General Manager
Miguel Galdos, USW/Santiago, Regional Director
