The Quest for Customer Innovation

High Oleic Soybeans: Delivering Now and into the Future

It’s not often that farmers radically change the way they produce a crop. But when it happens, it can make a major, positive impact on their profitability. Take the pork industry, for example.

In the early 1990s, consumer preferences and Smithfield’s push for more lean meat led to pork producers changing the way they raise hogs. Today, the industry produces meat with less fat and more-lean protein, which meets their customers’ evolving needs. And this opened the industry up to more profit opportunities.

That’s not too different from high oleic soybeans. The added nutritional qualities and improved heat stability is already opening doors for long-term profit opportunities from end-use customers: food and industrial users, alike.

While the soybean industry isn’t looking to change the entire crop, high oleic soybeans hold the potential to add demand and long-term profit potential for all U.S. soybean farmers. In fact, if the soybean industry meets its goal of 18 million planted acres to high oleic soybeans by 2023, high oleic soybeans will be the fourth-largest crop in the United States – behind corn, commodity soybeans and wheat.

“When we talk about something that will be 30 percent of our production in fewer than 10 years, we’re no longer talking small,” says John Motter, a soybean farmer from Jenera, Ohio, and a farmer-leader on both the United Soybean Board and Ohio Soybean Council. “High oleic is a big opportunity. It’s not a niche; we’re talking long-term solutions for our customers – big customers.”

Global Regulatory Approvals on the Horizon

To become the United States’ fourth-largest crop, high oleic soybeans will need to expand rapidly throughout the United States. For that to happen, high oleic needs to be approved in all major export markets.

Since seed companies put high oleic soybeans in their pipelines more than a decade ago, starting the approval wheels in motion, today they stand on the cusp of global regulatory approval.

“Global import regulatory approval is something we at Monsanto deal with on a regular basis,” says Sarah Vacek, soy quality traits product manager for Monsanto. “Every entity in the soy value chain – seed companies, retailers, farmers, elevators, processors and end users – everyone, is impacted if we all don’t play an active role in good stewardship of these traits. It’s important that everyone works together as good stewards of these products to help protect the industry for the future.”Because seed companies created high oleic soybeans using advances achieved through biotechnology, each trait must get individual approval from major soybean export markets before it can be grown broadly throughout the country. After a lot of patience and perseverance, high oleic soybeans are approaching the finish line.

“The finish line for regulatory approval is really the starting line for commercial advancement,” says Russ Sanders, director of food and industry markets at DuPont Pioneer. “We will see high oleic soybean acreage expand more rapidly after approval.“

For processors and end users, global approval removes the last headwind and makes accepting high oleic soybeans easier for them,” Sanders explained. “That equates to better farmer economics.”

In the European Union, regulators must first approve individual traits. Both Pioneer and Monsanto are in the final stages for approvals there. Then, in a separate process, the European Union will approve the high oleic traits stacked with other biotech traits, specifically Roundup Ready and Roundup Ready 2 Yield.

Once the EU approvals are announced, Pioneer will have completed the regulatory approval process. Monsanto is right behind. With European approval, they will wait for China before advancing with momentum.

The Yield You Want

High oleic soybeans still remain fairly new to the soybean-production conversation, having been grown in select regions of eight states this season. But John Motter has grown high oleic soybeans on his northwest Ohio farm for four years. In fact, Motter believes in high oleic soybeans so much that he dedicates 100 percent of his soybean acreage to them.

“Four years in, and I’m still seeing yield parity with other commodity farmers in my area,” says Motter. “As farmers, we need to meet our needs, but we also need to deliver what the customer is asking for. That’s why I grow high oleic and why others should join me.”

High oleic soybean varieties must meet criteria on both sides of the soybean equation: for farmers and for customers. First, the seed companies ensure that high oleic soybean varieties meet strict yield guidelines, culling any variety that does not meet the same parameters set for other commercial varieties. Then, the oil from the varieties must meet the specifications set by key food customers.“

Long term, Pioneer will continue to develop our high oleic seed varieties using elite genetic lines along with the most advanced defensive traits in order to provide farmers with yield performance that’s as good or better than the commodity beans they may be growing,” adds Sanders. “Our high oleic programs will also take into consideration long-term weed-management strategies for our farmers, arming them with the tools they need to manage their fields.”

The extra time spent breeding is paying off. Farmers throughout the soybean-growing regions are happy with high oleic soybean performance in their fields. That satisfaction leads to repeat customers and expanded acres.”

Making sure that we breed for the right yield and agronomic and resistance packages is our priority, and farmers are really pleased with the performance they are seeing on their farms,” says Monsanto’s Vacek. “We’re seeing an impressive number of return farmers year after year. The farmers who stay with our high oleic varieties are a real testament to their performance.

”That’s true for Isabella Chism, who has grown high oleic soybeans with her husband, Kent, for three years on their north-central Indiana farm.“

The first year we thought we’d try them out and they performed so well we kept growing them,” says Chism. “They yield the same, and you get a fair premium for the limited cleanout. It’s definitely a profit opportunity for our farm.”

The Demand You Need

High oleic soybeans meet customer needs that commodity soybean oil cannot satisfy. So, as commodity soybean oil continues to meet its own customers’ needs, together the two oils add to the overall demand for U.S. soy.

The higher functionality attracts food customers who need an oil that doesn’t break down in high-heat situations. Food service, such as cafeterias in schools and hospitals, as well as restaurants ranging from fast food to high-end, can benefit from high oleic soybean oil.

But the benefits don’t stop there. For the same reason the food industry wants the oil – high-heat stability – new industrial markets will take another look at U.S. soy. Opportunities to have high oleic soybean oil replace petroleum in synthetic motor oils, automotive lubricants and even cosmetics continue to come to fruition.

Experts expect high oleic soybean oil to reach 9 billion pounds of food, industrial and export demand by 2023.

The Competition You Don’t See

Unlike the pork industry of the 1990s, U.S. soy’s customers are not demanding change. Instead, those who need the functionality that high oleic now offers have simply found other sources of vegetable oil to meet their needs: palm, canola and sunflower, to name just a few.

The same processors that handle U.S. soy also handle their customer needs with those other oils. Canadian canola-filled rail cars are regular visitors to processing plants that used to dedicate themselves solely to U.S. soybean oil. Imports of palm oil to the United States have increased fivefold in the last decade.

But that isn’t the end of the story. Soybean farmers can successfully transform their industry, just like pork did. If U.S. soybean farmers can prove they will grow a consistent, abundant supply of high oleic oil, the food customers who have turned to other oils will return to their tried-and-true partner: U.S. soy. But first, farmers have to grow them.

Farmers interested in learning more about high oleic soybeans should visit: www.SoyInnovation.com or talk to their local seed rep.

 

 

 

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