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Demand for non-GMO beans still on the rise



Illinois Correspondent


PARIS, Ill. — Specialty soybeans-- including non-GMO, organic, food grade, soybeans for seed and high oleic-- are continuing to pay monetary premiums for Illinois growers, as the market for non-commercially produced legumes continues to grow in the U.S. and abroad. Though some growers who would like to tap into the burgeoning, consumer-driven market for specialty beans may not be able due to their non-proximity to processors; many Illinois growers are generating extra revenue from their specialty soybeans.

For some growers, the difference in prices for specialty beans allows them to show a net profit on their yearly balance sheets without having to add additional acreage, while market values for traditional, commercially-raised crops continue to shrink.

“We are seeing significant growth within specialty,” said Molly Stalker, specialty grains leader for Cargill Ag of Paris (Wayne County), Illinois. “Our focus is primarily on what I call generic, non-GMO beans. Ours is more of a non variety-specific program.”

Specialty crop programs have been around for more than 20 years, since the introduction of non-GMO soybean varieties in the late 1990s, Stalker continued. “Consumer preference then was primarily centered in Asia, though a market shift towards increased domestic consumer demand for non-GMO products has been occurring in the United States for the past five years now. This has created a really nice opportunity for growers to enhance revenue in a period of lower futures prices,” she said.

The market for non-GMO soybeans grown for human consumption is expanding along with demand for non-GMO animal feed and soybeans used in aquaculture, according to Stalker. “It is creating a really nice market opportunity where more and more growers can find more and more customers to sell premium soybeans to,” she said.

The growing market for specialty soybeans and other non-GMO products is primarily driven by “younger generations that are making values-based choices in their food consumption, looking for more transparency” in how their food is grown, said Stalker. “Some of those products are organic, some are non-GMO, but the market is really driven by consumers who want to know the story of their food. There is a trend of wanting to see where the base food products are coming from.”

Depending on location and market access, growers of “generic,” non-GMO soybeans can realize premiums of between 50 cents to $2 per bushel over commercial beans, Stalker disclosed. Though other types of specialty beans can demand higher premiums, the non-GMO varieties grown to Cargill’s specifications are easier to grow and more cost efficient, she added.

Taking advantage of the surge in specialty demand, many grain merchandisers now offer programs that provide markets for farmers to grow and sell differentiated soybeans. One is Omaha-based Scoular, a leading specialty and organic grain merchandising company with a presence in northern Illinois. Greg Lickteig, director of specialty grain for Scoular, said contracts for identity-preserved, non-GMO soybeans can be highly competitive.

“Our specialty soybean activity is focused in Will County, Illinois, because it is export-driven. We’ve been involved in food grade specialty soybean markets for 25 years, and have long standing relationships with buyers,” he said.

Scoular’s market is driven by demand from Asia, where soy foods are a staple along with rice and seafood. Their identity-preserved specialty soybeans are used in tofu, bean paste and meso, or kang, along with soy milk. “Soy milk is the fastest-growing market for soy-based foods in Japan right now,” said Lickteig, adding that the two largest markets for U.S. specialty soybeans are Japan and Korea, with China a distant third. “A lot of countries, like China, use commercial soybeans for human consumption.”

Now that a “phase one” trade resolution has been reached between the U.S. and China, Lickteig is hopeful to expand the market for specialty beans there. “When the trade wars hit we were on the verge of expanding our market in China for the U.S. and for Scoular, but that (stalled) in the last two years,” he said. “We have a lot of hope for better trade relations with China.”
Scoular operates a shuttle facility in Waverly, Illinois, and a container export facility in Andres. The company’s Chicago office is one of 102 worldwide offices that have accrued more than $4 billion in sales.

“We receive soybeans direct from the farm, we clean and process them and we ship them by container. We chose Will County for the site because of the access to competitively priced container freight in Chicago, the largest port in North America for container shipping on the inboard side,” said Lickteig. “This creates a lot of empty containers, which we fill for export.”

Scoular is looking for specialty soybean growers that produce high-yielding, competitive beans that fit farmers’ soil, geography and climate profiles. Working with major seed companies like Pioneer and Syngenta, along with smaller companies like Beck’s, specialty soybean growers contracted with Scoular are being paid premiums between $1 to $1.50 per bushel for their crop. Some varieties can bring as much as $2 per bushel more than commercial soybeans, according to Lickteig.

Neither Cargill, Scoular or the Illinois Soybean Association could offer any data or statistics on what percentage of their members had shifted their commercial soybean acreage to specialty varieties in the past five to ten years. Less than 10 percent of U.S. farm acreage is currently used for non-GMO crop production, according to the USDA.