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Home » US-China deal spells growth for wheat growers

US-China deal spells growth for wheat growers

Demand for apples also on the upswing

December 17, 2020
Kevin Blocker

While COVID-19 may continue to wreak havoc on certain sectors of the economy next year, observers involved in two of the state’s five largest agricultural commodities predict they won’t be among them.

Officials with the Washington Grain Commission and Washington Apple Commission separately say they’re expecting a strong 2021.

Glen Squires, the CEO of the Spokane-based commission, says 2020’s harvested wheat crop produced 165.6 million bushels of wheat, the fourth-highest volume in state history.

“And the quality of the crop was exceptional,” Squires says.

Though the price of soft white wheat, which is the variety that makes up most of the wheat grown across the Pacific Northwest, hovered just above $5 a bushel for most of the year, recently the price has started to climb. The price of soft white wheat was $6.20 a bushel as of Dec. 4, Squires says.

This year, the U.S. and China reached a historic agreement on the first phase of a trade deal that requires structural reforms and other changes to China’s economic and trade regime in a variety of areas, which includes agriculture, according to the terms of the agreement.

The agreement also includes a commitment by China to make additional purchases of U.S. goods and services in the coming years.

In a short period, China has moved into fourth place among the top five countries buying Washington wheat, Squires says. The Philippines, South Korea, and Japan are the top three exporters, while Indonesia is fifth.

China has purchased 386,000 tons of U.S. wheat this year, compared with zero tons in 2018, Squires says.

“We anticipate China will continue to be a growing market for U.S. wheat growers,” he says.

The Northwest Regional Field Office of the U.S. Department of Agriculture’s National Agriculture Statistics Service says the value of Washington state’s agricultural production totaled $9.49 billion in 2019, down 2% from the year-earlier value of $9.68 billion.

Apples continue to remain the leading agricultural commodity in Washington with a 2019 value of $1.96 billion. Milk follows with a production value totaling $1.28 billion; potatoes, $934 million; wheat, $793 million; and cattle and calves, $699 million, according to NASS.

As for apples, this year’s crop is expected to reach 118 million boxes, a decrease from 134 million in 2019, says Toni Lynn Adams, the community outreach specialist for the Wenatchee, Washington-based Washington Apple Commission.

Adams says apple harvest volume can be be cyclical in nature, so the fact this year’s volume was lower didn’t come as a surprise to growers.

Washington’s more than 1,200 apple growers produce 128 million boxes on average per year. A single box weighs 40 pounds, Adams says.

But while production was down, consumer demand for apples is abnormally high, she says.

“There’s a lot of optimism for 2021 because across the board, fruit and vegetable consumption has been higher than normal as people have stayed home due to COVID-19,” Adams says.

“National demand for apples is very high right now,” she says.

The general public continues to become more health conscious, and pandemic-driven shopping has fueled unprecedented purchases in bulk by consumers, she says.

Washington is the nation’s leading producer of apples, representing 65% of all U.S. fresh apple production.

Mexico and Canada are the largest importers of Washington apples in the world. The state exports a third of its crop to more than 60 markets worldwide, accounting for 95% of all the country’s apple exports, according to the commission.

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