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10 



- Fourth, purchase contracts from millers and exporters increasingly contain 

 clauses that specify a maximum vomitoxin content in wheat. Many markets 

 typically set a maximum vomitoxin level of 2 parts per million, but some have 

 begun to specify a zero tolerance. USDA itself has set a maximum 2 p. p.m. 

 vomitoxin level for wheat furnished for its export donation programs to foreign 

 countries. Clearly, these quality demands of these milling and export markets 

 are translated into the wheat purchasing specifications of country and terminal 

 elevators from their farmer-customers. 



Given the myriad factors we have just discussed, raw grain handlers - be they 

 country or terminal elevators - took actions early in the harvest season that they believed 

 to be prudent to protect their financial integrity. These actions ranged from initially not 

 accepting wheat containing vomitoxin to accepting it only after adjusting its price to reflect 

 the elevator's perceived risk in the absence of a clear market demand for such wheat. 



However, as these marketplace uncertainties have gradually been cleared up, it is our 

 understanding that the pricing spread between high-quality wheat and weather-damaged wheat 

 has begun to ease. A key component has been FDA's clarification of its regulatory stance. 

 Although it is unrealistic to expect wheat containing vomitoxin to be priced equal or nearly 

 equal to uncontaminated milling-quality wheat, we believe that markets have sufficient 

 information to properly utilize the current stocks of contaminated wheat at a price that fairly 

 represents its value and in a way that protects the safety of our food and feed supply. 



Conclusion 



In closing, the incidence of naturally occurring mycotoxins in grain is not a new 

 problem. It has been with us for many years. And the market has developed sophisticated 

 and proven ways to adapt to a wide array of situations. 



