USA – The Taiwan Flour Mills Association has signed an two year agreement to buy US wheat sourced from Idaho in a deal valued at US$576 million.
According to the letter of intent signed at Idaho, Taiwan Flour Mills Association plan to buy about 1.8 million metric tons of wheat, or 66.1 million bushels, between 2020 and 2021.
The association buys wheat for all 20 Taiwan mills and has been purcgasing the commodity from Idaho wheat growers for more than 40 years. The amount is up slightly from two years ago.
Governor Brad Little of Idaho made the announcement alongside representatives of the and the Taipei Economic and Cultural Office in Seattle.
“Taiwan is our second-largest export market overall and an important trade partner for Idaho,” said Governor Brad Little of Idaho.
Little said that while the wheat market fluctuates, having Taiwan as a large, longstanding customer for Idaho wheat benefits the state in the long term and is in contrast to current global trade tensions.
“Taiwan is a loyal customer for our Idaho wheat growers, who proudly produce a high-quality, consistent product,” Little added
Blaine Jacobson, executive director of the Idaho Wheat Commission (IWC) added, “This two-year agreement highlights the strong relationship between Idaho wheat growers and their customers in Taiwan.
According to a World Grain report, Taiwan imported nearly US$4.3 billion worth of US farm products in 2018 and is the the fifth-largest market for US wheat.
The US$576 million commitment from Taiwan comes as further relief to US farmers following the recent interim trade agreement signed between US and Japan with Japan.
US President Donald Trump and Japanese Prime Minister Shinzo on Wednesday signed a trade agreement that lowers or eliminates tariffs on many U.S. agricultural products and increases market access in Japan.
Under this first-stage initial tariff agreement, Japan will eliminate or reduce tariffs on an additional US$7.2 billion of US food and agricultural products.
According to the US Department of Agriculture (USDA), Japan imported duty free food and agricultural products worth US$5.8 billion in 2018 out of the total US$14.1 billion worth of agricultural products imported from the nation.
Preferential market access will be provided for some products through the creation of Country Specific Quotas (CSQs) including wheat and wheat products, malt, glucose, fructose, corn starch. Potao starch and inulin.