Soy’s Dual Fuel Dilemma

March 2, 2013 11:00 PM

The burgeoning soybean-as-fuel market has represented a huge victory for the crop in recent years. Total production hit of biodiesel topped nearly 1 billion gallons in 2012, according to the U.S. Energy Information Administration. It takes nearly 8 billion pounds of soybeans to produce this much biodiesel.

But some see this success as merely offsetting losses from the decimated demand of another type of soy-based fuel -- edible oil. Regulatory restrictions of biotech products in the European Union and elsewhere have lowered demand of soy-oil by 4 billion pounds annually since 2008.

One solution is to develop both the supply and demand of high-oleic soy varieties and ease current restrictions surrounding those products. New efforts from the soy checkoff may accomplish just that by accelerating high-oleic varieties to market, increasing demand all down the value chain and lobbying for regulatory approvals overseas.

High-oleic varieties are already on the market in a limited capacity. Currently, Plenish varieties from DuPont Pioneer have been commercially produced for the past three years. They have a healthier oil profile and increased oil stability, and often earn farmers a 50-cent premium.

But because it is a biotech product, Plenish is limited to certain contract farmers, processors and customers to ensure the end oil remains in a closed system that isn’t sold to the European Union or China.

"What we really need is EU approval to expand U.S. production without international trade interruption," says American Soybean Association chairman Steve Wellman.

Several U.S. organizations are working hard to help this happen. The soy checkoff, which is overseen by the United Soybean Board, plans to communicate high-oleic oil’s market potential to farmers and encourage them to grow the varieties when they become available in their areas. Meantime, the checkoff has already partnered with DuPont Pioneer and Monsanto to make additional varieties available to as many farmers as quickly as possible.

"The checkoff is working hard to make varieties available to farmers and grow the demand for the oil," says Jim Call, USB vice chair and a soybean farmer from Madison, Minn. "It’s important for the future of the U.S. soy industry. High oleic soy oil’s increased functionality and stability gives it the potential to take back lost edible-oil market share and expand the use of soy oil in industrial applications."

To build additional demand for high oleic oil, the checkoff will showcase the oil to food manufacturers and food-service companies so they can conduct performance and product-formulation tests. The checkoff will also partner with chefs, concoct recipes and hold cooking demonstrations as part of additional promotional efforts.

As consumers demand higher-quality food that is grown responsibly, there can’t be a single weak link in the value chain, says John Motter, USB director and soybean farmer from Jenera, Ohio.

"We’ve lost a great deal of market share, and we need to embrace the new technology that’s available to us as growers," he says. "We have to look beyond the elevator and on to the consumer and create demand for a better oil for the cooking industry."

Motter says he plans to plant 100% high-oleic soybean varieties this year.

It’s critical to educate the public about the importance of high-quality soybeans and soybean oil, say industry experts such as Illinois Soybean Association CEO Craig Ratajczyk. At the same time, educating the farmers themselves is equally important.

"Protein and oil content are becoming just as important as yield," he says. "It’s what buyers want. It’s a simple end-game, but we need to change the culture."

In the video below, ISA production chair Rowen Ziegler explains to Farm Journal seeds editor Rhonda Brooks the benefits -- and changes -- farmers could expect from growing higher-quality soybeans.

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