By LINDA McGURK
Indiana Correspondent

BISMARCK, Ill. — Concerns about prices and a continued stable supply of United States soybeans topped the agenda of a Japanese trade team that visited Illinois last week.

“I have some doubts about prices,” said Shoji Kayanoma, general manager of a soybean processing plant in Yokohama, Japan. “I see good production of (U.S.) soybeans while prices are increasing. I see a contradiction in that.”

While visiting the Midwest, the Japanese delegates got a chance to talk directly with farmers about their planting decisions and yield predictions, as well as take a closer look at the beans in the fields. Several of them had never been to the U.S. before and enjoyed an hour-long tour of a grain farm near Bismarck, Ill., courtesy of Mike Cunningham, a board member of the U.S. Soybean Export Council (USSEC) and the director of the Illinois Soybean Assoc.

With the help of an interpreter, they asked questions concerning everything from the weather’s effect on this year’s crop, the expected oil contents of the beans and the cost of a combine.

“It’s been very interesting, because this is a good time to observe this year’s harvest and confirm that farmers around here will get good results,” said Akira Ogawa, marketing director of the American Soybean Assoc. – International Marketing (ASA-IM) office in Japan.

The delegates, who mainly represented the crushing industry, visited the U.S. through a partnership program put on by the USSEC. Combined, the delegates represented companies that import 75 percent of the American soybeans in Japan.

“These people are very important customers to American farmers. They’re very loyal; even when prices go up they buy from us,” said Paul Burke, marketing director of USSEC (also known as ASA-IM in overseas markets).

Japan is the third largest export market for U.S. soybeans. Even though American farmers only produce 37 percent of the world’s soybean crop, the U.S. has a disproportionate 80 percent market share in Japan.

Part of the American advantage is geographical; shipping soybeans from the Pacific Northwest to Japan is both fast and economical, and many Japanese trade companies have made significant, long-term investments in American infrastructure. Burke also attributed the success to the presence of the American soybean industry in Japan and the marketing activities made possible by the soybean checkoff.

“We’ve had an office in Japan for 50 years and we do activities like this (the partnership program),” he said. “None of our competitors do that.”

Takehiko Tom Nishio, the country director of ASA-IM in Japan, agreed: “One of the main selling points (for American soybeans) is that we as an organization always can provide backup support. If they have a problem, they can always get in touch with us and that makes them feel more comfortable.”

A major cause for concern for the Japanese delegates was that U.S. growers switched a lot of their soybean acres to corn this year, because of the rapid expansion of the ethanol industry.

“Our customers want to know if that’s going to be a trend, because they rely heavily on imports from the States,” said Takehiko. “They appreciate the quality and stable supply of U.S. soybeans,” he added and noted that the quality of competing Brazilian soybeans is not always stable, even though it is improving.

Record corn acres in combination with increased demand for beans from the biodiesel industry could present some challenges for the soybean export industry, but Burke remained optimistic.

“My personal opinion is that exports will still be very significant,” he said. “I think the export volume will be less, but I think we’ll probably keep exporting 45 percent of the total production – more meal and less beans.”

This farm news was published in the Aug. 29, 2007 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.