Meanwhile, exports to Mexico, Nigeria, Philippines and Japan are ahead of normal. And with many key competitors unable to provide wheat to their traditional customers, Peterson anticipates the second half of the marketing year will allow the U.S. to meet that 31.3 million metric ton export forecast.
There is a caveat, however. The U.S. Wheat Associates is largely funded by farmers, through state checkoff programs. These funds are matched by the federal government through USDA programs called Foreign Market Development and the Market Access Program. Both are funded through the recently expired Farm Bill. With a new Farm Bill in limbo, U.S. Wheat's ability to assist buyers is compromised. The organization has reserve funds, but these will last only through May, at best.
Peterson says the 2012-13 marketing year provides tremendous opportunity for U.S. exports due to the global weather concerns. But the U.S. faces stiff competition from Canada, which had a large crop featuring excellent quality. And, this is the first year that Canada's wheat is available on an open market, prompting a lot of interest from private companies eager to gain access to Canada wheat.
"Frankly, we need to be front and center and the federal funding issue is a big deal for us," he says. "We're trying to make changes to extend it as long as we can, but there has to be movement on Capitol Hill to pull that out for us."