St. Louis, Missouri
May 7, 2007
Demand for soy biodiesel has
soared, with 75 million gallons of biodiesel produced and sold
in 2005 and an estimated 225 million gallons produced and sold
in 2006. That’s great news, but it is important for soybean
farmers to understand how the increased use of soy oil for
biodiesel production will impact the meal side of the soybean
industry.
“To fulfill the increased demand for biodiesel, it’s expected
more soybeans will have to be crushed, resulting in additional
soybean meal supplies,” says George Martin,
United Soybean Board
(USB) Soybean Meal Task Force chair and soybean farmer from
Nebo, Ky. “This leaves soybean farmers and the rest of the
industry to answer the question: ‘What will happen to all the
additional soybean meal?’”
To answer that question, USB and the soybean checkoff launched a
Soybean Meal Task Force and commissioned a comprehensive study,
“Soybean Meal Evaluation to 2020.” The 250-page study serves as
an information resource and planning tool to help soybean
farmers and the soybean industry anticipate possible scenarios
for demand and customer needs for the future. The study found
that the future of soybean meal is influenced by many factors,
such as petroleum oil prices, export markets, the global animal
agriculture scenario, competition from alternative feed
ingredients and improved compositional traits for soybeans.
Research showed that increased domestic crush to produce more
oil for biodiesel production could have a significant impact on
exports by the year 2020. Currently, the majority of soybean
exports produced in the United States are exported as whole
beans, but in the future the soybean industry may need to export
more soybean meal rather than whole soybeans. Cultivating
exports of soybean meal will be extremely important, but
maintaining current markets is even more critical. This means
fostering domestic animal agriculture, which currently consumes
98 percent of the soybean meal used in this country.
“Virtually all of U.S. soybean meal is fed to U.S. livestock and
poultry, so we have to keep animal agriculture viable in this
country,” says Martin. “We can’t afford to export livestock and
poultry production to other countries. Bottom line, if you are a
fan of biodiesel, then you need to be a fan of U.S. animal
agriculture. Their viability goes hand in hand.”
The report expects U.S. animal agriculture to be able to utilize
about 20 percent of the increased supplies of soybean meal. To
make sure that happens, the soybean checkoff continues to
support meat and poultry exports, as well as research to provide
feed formulators with soybean meal that best fits the needs of
livestock and poultry producers. In addition, soybean farmers
need to understand that their success is tied to domestic animal
agriculture, and that they should support their fellow livestock
farmers, when they encounter challenges to doing business.
USB is made up of 64 farmer-directors who oversee the
investments of the soybean checkoff on behalf of all U.S.
soybean farmers. Checkoff funds are invested in the areas of
animal utilization, human utilization, industrial utilization,
industry relations, market access and supply. As stipulated in
the Soybean Promotion, Research and Customer Information Act,
USDA’s Agricultural Marketing Service has oversight
responsibilities for USB and the soybean checkoff. |
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