Statement
of
John C. Miller
President, Miller Milling Company
On
behalf of the
North American Millers' Association
Before
the
International Trade Administration
June 6, 2001
My name is John Miller. I am
president of Miller Milling Company with mills in
Fresno, California, Winchester, Virginia and Sonora,
Mexico. Those three mills grind about 62,000 bushels
of durum and hard red spring wheat each day. Miller
Milling is also a minority owner of New World Pasta
Company, the largest branded pasta company in the
United States. I am also chairman of the Minneapolis
Grain Exchange.
I am here today to testify on behalf of the North American Millers' Association (NAMA) and its 45 members. Those member companies operate 175 wheat, corn, oat and rye mills in 38 states. Their collective production capacity of more than 160 million pounds each day represents 90 percent of the industry capacity. About 80 percent of that production is wheat flour.
Rather than recite and repeat statistics and positions that have been included in the material provided to you by NAMA and others, I will share with you my company's experiences and perspective on the issue you are investigating. I am a better flour miller that I am a statistician, lawyer or lobbyist. The decisions you make will have a dramatic impact on our company and our employees. I appreciate the opportunity to tell our side of the story.
U.S. millers buy Canadian durum primarily because the United States does not produce enough durum wheat of the quality our customers, U.S. pasta makers, require. This has been the case since we built our first durum mill in 1986 and it remains the case today. Competitive access to Canadian durum allows us to fulfill our obligation to supply U.S. pasta makers with the quality and quantity of semolina they require to satisfy U.S. consumers and compete with imports. Canadian durum is a necessary supplement to U.S. production of high quality durum, especially in years where adverse weather or farmer crop choices further reduce production of high quality durum.
If we did not have access to Canadian durum to supplement U.S. production the following would occur in the short term. The limited supply of U.S. high quality durum would need to be blended with lower quality durum or non-durum flours to satisfy quantity demand. This would result in pasta quality that would be noticeably lower that current consumer expectations and less than the quality readily available in imported pasta. Imported pasta as well as competing foods such as rice and potatoes would take market share and volume away from U.S. pasta producers.
Also, pasta companies who tried to maintain high quality raw materials would be at a significant price disadvantage to imported pasta or competing foods. Demand for U.S. produced durum wheat would decline.
In the longer term, production of both semolina and pasta would move offshore where adequate supplies of high quality durum wheat are available at competitive prices. The mill we recently completed in Sonora, Mexico is an example of the kind of adaptation that would increasingly occur in response to limitations on our ability to source enough high quality durum in the United States. Once again, demand for high quality durum in the U.S. would decline. Once again, the owners and employees of Miller Milling Company would be damaged.
In the twenty years or so that I have been a durum miller, the attempt to prevent U.S. durum millers and pasta companies from having competitive access to Canadian durum production has become an annual event. I have testified before this and other governmental bodies about durum wheat and I have filled out lots of detailed questionnaires. In every case my testimony and the data I have provided confirms that Canadian durum is offered to us at prices reflecting the price of durum in the U.S. market. We attempt to make U.S. and Canadian sources compete for our business in terms of price, quality, service and terms.
On many occasions the only offer we have for durum in a particular delivery period is from Canadian sources. On other days the Canadians are unwilling to lower their prices to be competitive with U.S. offers. I don't perceive any continuing differences in buying from Canadian or U.S. sources. They are all tough negotiators trying to sell their durum for as much as they can. I believe the studies and investigations that have taken place over these many years confirm my experience. If the Canadians are selling durum at less than market prices or better than market terms I'm not getting any of it.
Once again I will fill out my questionnaire as accurately as possible. I will try to honestly represent the perspective and experience of my fellow millers. And I will once again put my faith in the objectivity and independence of the International Trade Commission to fairly and accurately separate fact from opinion and law from desire. Thank you for giving me your time today.
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