Shipping Soy Relieves Bursting Bins

With U.S. soybean production continuing to increase each year, the soybean industry is making sure all these soybeans have places to go.

While domestic use of soybeans in the U.S. has leveled out over the years with annual soybean meal consumption remaining around 1.2 billion bushels since the 2008/09 marketing year, the status of the export market has never been better. In the latest marketing year (2013/2014), farmers exported 2 billion bushels of U.S. soy to their international customers.

“Nearly 60 percent of soybeans grown in the U.S. get exported to other countries, so exports are extremely important to the bottom lines of all U.S. soybean farmers,” says Laura Foell, soy checkoff farmer-leader from Iowa and U.S. Soybean Export Council (USSEC) chair. “Without exports, the price of soybeans would drop considerably and farmers would suffer economically.”

With further production gains expected, it’s even more important to find buyers for all of these soybeans. Supported by the soy checkoff, USSEC works to improve customer preference for U.S. soybean meal by helping buyers recognize the value of higher quality and better service.

“USSEC focuses on regions in which we could increase our exports of soybeans,” Foell says. “For example, Europe has increased their imports of soybean meal from the U.S. in order to feed their livestock. Without the work of USSEC, this market would have continued to be stagnant for U.S. soybeans.”

With animal agriculture serving as the primary driver of the region’s soybean use, U.S. soybean meal exports to Europe have tripled in recent years.

domestic soyOne market that U.S. soybean farmers are hoping to access in the near future is India. Since 1990, soybean oil consumption in India has grown 590 percent and soybean meal consumption has risen 709 percent, due to an increase in population, income and meat consumption there. The checkoff has worked to increase the amount of U.S. soy used in food products and for poultry and aquaculture feed in that country.

“USSEC has been constantly in touch with their Indian counterparts for the last 14 or 15 years and has developed those relationships from the ground level,” says Himanshu Jain, chief operating officer of the Prestige Group of Industries, an agriculture company in India. “People in India have started to realize soy is a better product now, and we are seeing the consumption of soy increasing in India.”

While there is potential growth in the European Union and India, countries such as China, Japan and Mexico remain top destinations for the U.S. soybean export market.
 

One of the reasons buyers from these countries choose U.S. soybeans is because of the confidence they have in the American transportation system. According to a soy-checkoff-funded study, some foreign customers said that predictability of delivery is a key factor when deciding where to buy soybeans. Overall, the respondents identified Brazil as the least predictable origin in terms of late shipments during the peak export season, followed by Argentina. The U.S. was viewed as the most predictable.