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A Boost for Beans

Demand for healthier oils for food processing has taken off this past year, and the soybean industry is working to grab as much of the market as it can with low-linolenic soybeans. But getting farmers to grow enough of the special-trait beans could be the biggest challenge in meeting that demand.

As recently as late January, companies were boosting their premiums and adding signing bonuses to attract more acres and be more competitive with projected 2007 corn prices. But that could be a tall order, with $3.00 to $3.50 corn expected this season.

For example, using current 2007 crop futures prices, Purdue ag economists project returns on corn could be more than $50/acre higher than returns on traditional soybeans, on average quality Indiana land. Others have projected a much wider gap, closer to $100/acre. It's still debatable whether higher premiums will enable low-linolenic soybeans to close in on projected corn profit levels. But for farmers looking to maximize profit potential on soybean acres, these varieties may more than fill the bill.

With major companies such as Kellogg Company and KFC Corporation making the switch from regular soybean oil to the low-linolenic version, demand for this healthier oil is outpacing supply. Industry experts expect food processors, looking to avoid use of hydrogenated oils that contain trans fats, could use oil from nearly 3 million acres of low-linolenic soybeans in the coming year alone. That's almost triple the amount of low-linolenic beans grown in 2006.

Brand names that fall into the low-linolenic soybean category include Monsanto's Vistive soybeans, made into Vistive oil, and Pioneer brand low-linolenic soybeans, processed into what the company has branded Treus soy oil. Both Vistive and Treus oils contain less than 3% linolenic acid, compared to the typical 8% levels found in oil from traditional soybeans. That results in a more stable oil, needing little or no partial hydrogenation, which produces the unwanted trans fats.

Asoyia LLC, a farmer- and employee-owned company based in Winfield, IA, offers what it calls ultralow-linolenic soybean varieties, developed at Iowa State University, that contain only 1% linolenic acid. The company offers both non-genetically modified and Roundup Ready varieties, with the former garnering as much as $1.00/bu. premiums for this coming season.

Companies are working to contract for as many acres of low-linolenic soybeans as they can get to meet the incredible demand, and one processor — AGP — raised its premiums by $0.20 in late January for existing and new contracts, hoping to attract more acres. “This is a real opportunity for the soybean industry to meet the changing demands for healthier oils,” says Greg Twist, senior vice president for soy and corn processing, AGP.

Worth some soybean acres

Although low-linolenic soybeans may not steal too many acres from corn this season, the higher premiums may make producers consider them for some of their soybean ground. “We think our new premiums will encourage more producers to give them a try,” Twist says.

“We'll be taking most of our new acres from traditional soybeans this year,” concurs Brett Maxwell, vice president of operations for Asoyia. “There is an unusually high number of flex acres out there yet that farmers haven't made a definite cropping decision about this year. I expect we'll be signing contracts with some growers as late as April.”

If you've got the flexibility to handle an identity-preserved crop, low-linolenic beans may add profit over conventional soybeans, says Rick Nobbe, eastern region Vistive soybean manager for Croplan Genetics. “For this season, most processors are offering a $0.35 to $0.60 premium for these beans, and that is a pretty good return just for harvesting and handling them separately,” Nobbe says.

He notes that the number of processing and receiving locations has increased for 2007. “There are several new locations that will be processing the beans in Ohio, Illinois and Indiana,” he says.

Many cooperating elevators also have agreed to receive and separately store the beans, providing more drop points for participating farmers.

Bunge has expanded its processing of Pioneer brand low-linolenic soybeans to include southern Minnesota, more of Iowa, northern Missouri, Wisconsin, Michigan, Illinois and Indiana for this season. Asoyia has broadened its geography to include processing in Cedar Rapids, IA, and Bloomington, IL. “We've definitely got a more grower-friendly program this year, with wider windows for delivery and what should be shorter waits for truckers,” says Rich Lineback, Asoyia vice president of sales and marketing.

Yield concerns

Nobbe admits that because 2007 is only the third year of low-linolenic soybean production, some farmers may not be familiar enough with the varieties to try one. And although some producers fear the low-linolenic won't yield as well as their traditional varieties, he says field trials show otherwise. “Like any soybean, these varieties have to be positioned right — planted in the right fields that best match their characteristics — to get the best yields. When that's done, Vistive soybeans are very competitive in yield with conventional Roundup Ready varieties,” he says.

According to Lineback, Iowa State University soybean breeders have boosted the yields of several of their ultralow-linolenic varieties by 5 bu./acre over the last three years. “And this year Asoyia is offering more Group III varieties as well as two Roundup Ready varieties,” he says.

Soybean cyst nematode resistance, stronger disease resistances and iron chlorosis tolerance also have been bred into many low-linolenic varieties available this season. “These are solid varieties; we wouldn't be offering them if they weren't,” Lineback states. “We've had producers who get up to a $50/acre advantage over traditional beans with our ultralow-linolenic varieties.”

Continued on next page >

Identity preserved

Signing a contract to produce low-linolenic soybeans requires the use of basic identity-preserved practices. For its ultralow-linolenic varieties, Asoyia requires that farmers follow set production, harvest and storage protocols, especially for the non-genetically modified varieties. “By testing the crop at harvest and in storage, we are trying to help ensure that the farmer will have no problems with contamination at delivery,” Lineback says. “It's a valuable crop and we want to be able to process every bushel of beans the farmer delivers. Our IP program has proven very successful. I know of only one truckload of beans that was turned away at a processing facility all last year.”

Farmers who are comfortable with the identity-preserved process will have more opportunities to improve the profitability of their soybeans. “We're only at the beginning of producing and handling specialty-trait crops,” Twist says. “There's more in the pipeline for the next five to seven years, including high oleic varieties and those with omega 3 oils. These types of specialty traits hold great potential for food processors, as well as soybean producers.”

Specialty soybeans

These companies offer low-linolenic or ultralow-linolenic soybean varieties.


Brand: Vistive low-linolenic soybeans

Specialty trait: 3% linolenic acid content in oil

Available varieties: 28 seed brands carry Group II and III Vistive varieties

Processors: ADM, AGP, CHS, Cargill, Mercer Landmark, MN Soybean Processors, Perdue Inc., Zeeland Farm

Premium: $0.35 to $0.60/bu., depending on location and processor

Delivery points: Iowa, Indiana, Michigan, Minnesota, Nebraska, Ohio, Maryland

2006 acres: 500,000

2007 acre goal: 1.5 to 2 million
Visit, or circle 105.


Brand: Pioneer brand low-linolenic soybeans

Specialty trait: 3% linolenic acid content in Treus brand soybean oil

Available varieties: Five Roundup Ready varieties from mid Group II to early Group III

Processors: Bunge, CHS

Premium: $0.45/bu. for harvest delivery; $0.50/bu. for on-farm storage

Delivery points: Iowa, Illinois, Indiana, Ohio, Michigan, Missouri, Pennsylvania and Wisconsin

Special contract features: Contracted acres eligible for rebate on approved DuPont crop protection products

2006 acres: just under 200,000

2007 acre goal: 400,000 to 500,000
Visit, or circle 106.


Brand: Asoyia ultralow-linolenic soybeans

Specialty trait: 1% linolenic acid content in soybean oil

Available varieties: Five Group II and III non-genetically modified varieties and two Roundup Ready Group II varieties, plus several experimental varieties

Processor: Cargill

Premium: $0.45/bu. for Roundup Ready varieties; $1.00/bu. for non-genetically modified varieties

Delivery points: throughout Iowa and around Bloomington, IL

Special contract features: Transportation allowance of $0.05 to $0.15/mile

2006 acres: 35,000 acres

2007 acre goal: 100,000 acres
Visit, or circle 107.

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