Wheat finds way across Pacific

Grain changes hands many times before it ends up in mouths

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Ken Jants says he doesn't give much thought to the Japanese sponge cake or Korean crackers that result when his�soft white wheat is cold, shipped across the pacific, milled and then baked.

"Honestly, I don't think I've ever stopped to think about what it means to people on the other side fo the ocean," said the farmer, who harvest mostly soft white wheat from about 1,200 acres southwest of Waitsburg.

"My main concern is - No.1 - producing good-quality wheat and No. 2 is making a profit," said Jantz, who is also a Port of Walla Walla commissioner.

But when Jantz harvest his wheat and takes it to local grain cooperative elevators , it's only the start of a long journey that ends on dinner tables through the Pacific Rim.

More than 90 percent of the wheat grown in the Pacific Northwest is exported to Pacific Rim countries, where bakers use the flour in cakes, cracker and cookies.

Once harvested in the fields, Jantz's wheat is trucked to grain elevators owned by either Touchet Valley Grain Growers Inc. or Walla Walla Grain Growers Inc. TVGG has 13 elevators, which can store about 6.6 million bushels, while the larger WWGG can store about 11 million bushels in its 21 elevators and more in piles on the ground.

The grain cooperatives' two main functions are to store the wheat and provide a daily market for growers, said WWGG manager Don Schmidt.

"I talk to the buyers and buying companies - all of them - several times a day," he said. By telephone, he makes deals with wheat buyers and coordinates delivery dates. Perhaps the biggest challenge facing grain cooperatives in recent years is the movement of grain or logistics in the face of huge surpluses, he said.

When the wheat buyers - usually exporters based in Portland or other coastal cities - want delivery, the cooperatives load the grain on barges, railroad cars or trucks for the trip to export terminals in Portland or Vancouver, Kalama or Longview, Wash. Occasionally, some wheat is sold to domestic buyers such as Centennial Mills for U.S. consumption.

About half of the WWGG storage space is a its three terminals on the Columbia and Snake rivers. At Wallula and Port Kelley on the Columbia and Sheffler on the Snake, wheat is loaded on barge, which can carry 120,000 bushels, for the 36-hour trip to Portland. The barges travel at a speed of about 7 miles per hour.

Workers unload the wheat into the coastal export terminals in about four hours, said Don Peterson, regional manager for Harvest States Cooperative.

Historically, the Pacific Northwest's best customers are Japan and Korea, which together purchase nearly 200 million bushels of the region's wheat. This year, Egypt is expected to emerge as the third top Pacific Northwest customer as the north African nation takes advantage of the federal Export Enhancement Program, which provides cash discounts to woo customers way from European Economic Community.

Egypt is expected to purchase between 37 and 55 million bushels during this marketing year, which ends in May. Egypt purchased 40 million in the 1986-87 marketing year and only 4.8 million the previous year, according to Henry Sakamoto, assistant administrator for the Oregon Wheat Commission.

Buyers from foreign countries make public tenders or announcements that they want to buy a certain amount of wheat. Then exporters make bids, hoping to be awarded contracts. The methods of buying wheat vary from country to country, said Sakamoto.

• The Food Agency of Japan, a governmental organization, will buy its wheat only form Japanese import firms. Many of these firms are incorporated in the United States and , hence, are exporters. For instance, U.S. Mitsui owns the Vancouver-based United Grain Corp., and Marubeni America Corp. owns Columbia Grain Corp. in Portland.

Those firms buy directly from regional grain cooperatives like WWGG and TVGG or buy from other export firms, Sakamoto explained. The Food Agency makes public tenders on a weekly basis throughout the year.

• Selling to Korea is more direct, Sakamoto said. About half of Korea's Pacific Northwest wheat purchases are made by the Korea Flour Mills Industrial Association, which Sakamoto described as a quasi-governmental agency. KoFMIA, until two years ago, made all Korean wheat purchases.

But through a privatization program, now many of the larger Korean flour mills purchase their own wheat directly from Portland-are exporters.

• When Egypt wants to buy wheat, that country's Washington, D.C, embassy makes the public tender.

Peterson of Harvest States described the export business as very competitive, a marketplace based more on price and delivery than customer loyalty.

When deals are finalized on the coast, wheat is loaded onto ships for delivery to Japan, Korea, Taiwan and other countries.

The ship ride to Yokohama, Japan, in Tokyo Bay is 4,975 nautical miles from Portland and takes 11 days. The 5,749-mile trip to Hong Kong takes 20 days.

From those ports and others, the wheat is distributed to mills where the wheat is milled into flour. The flour mills, in turn, sell the flour to bakeries, which produce the sponge cake, flat bread, cookies, crackers and baked goods that Northwest white wheat is particularly suited for.

Although he says he doesn't give much though to the uses of his wheat, Jantz, the Waitsburg farmer, is concerned about his industry maintaining standards that will ensure continued markets. It's apparent that Jantz, as a businessman, has given that some thought.

"Starting with the farmer and the local cooperatives all the way to the exporters and the foreign buyers - if we don't produce quality wheat, we're going to receive a black eye."

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