For the first time since 1996, acres of Roundup Ready genetically modified soybeans could drop as more farmers decide to plant non-GMO.
Low commodity soybean prices, attractive premiums, and rising prices for genetically modified soybean seed are leading American farmers to plant more acres of non-GMO soybeans this year.
Representatives with soybean associations, universities, and grain buyers all say that demand for non-GMO soybeans is growing, leading to more non-GMO acres.
Genetically modified Roundup Ready soybeans have taken an increasingly larger percentage of US soybean acreage each year since their introduction in 1996, reaching 92% in 2008.
But this could be the first year that the trend reverses. Grover Shannon, a soybean breeder with the University of Missouri, Delta Research Center, thinks non-GMO acreage could account for 10% of total soybean acreage this year.
“Record number of contracts”
“We are seeing more interest in growing non-GMO soybeans,” says Mark Albertson, director of marketing, Illinois Soybean Association.
With commodity soybean prices around $9.00 per bushel, a premium of $1.00 or more for non-GMO is more attractive. “That is getting farmers’ attention,” Albertson says.
For example, Iowa-based ASOYIA is paying farmers as much as $2.75 per bushel to grow its non-GMO low linolenic soybeans.
Albertson has talked to several farmers who haven’t grown non-GMO soybeans in eight years, but will this year because of the premiums.
Grain companies large and small are contracting farmers to grow non-GMO. “We called all the companies buying non-GMO, and about one-half of them had enough acres,” Albertson said.
“We are seeing a record number of non-GMO soybean production contracts being written this spring,” says Greg Lickteig, senior group manager, The Scoular Company. “It’s a tremendous response.”
“We see more growers switching to non-GMO production for 2009 planting,” says Joe Hanusik, manager at Harmony Agricultural Products in Ohio.
University soybean breeders also see growing demand for non-GMO soybeans. “The demand happened so fast. All of a sudden in the last year, farmers wanted to grow non-GMO soybeans,” Shannon says.
“The demand has been increasing in the last two years,” says Bill Schapaugh, a soybean breeder at Kansas State University. “The demand in 2008 was greater than in 2007, and it is greater this year than in 2008.”
Increases in commodity and food-grade non-GMO
Grain buyers report that acreage increases are expected for both generic commodity non-GMO soybeans and specialty food-grade varieties. “Conventional varieties can capture a premium at the larger companies and many farmers like working with Cargill and ADM,” says Tim Daley, a soybean trader at Stonebridge, Ltd. “Higher premium food-grade beans are also getting the interest of producers due to the premiums over Chicago Board of Trade.”
Chris Bradley, a trader with Ceres Commodities, sees a bigger increase in acreage of commodity non-GMO soybeans. “Identity preserved food-grade soybeans have increased as well but not to the degree of generic non-GMO,” he says.
“Farmers upset with Monsanto”
Besides the higher non-GMO premiums, there are other reasons for the increasing acreage of non-GMO this year. One is lower cost. “The Roundup Ready system is not as cheap as it used to be,” Shannon says.
The cost for Monsanto’s Roundup Ready GM soybean seeds has increased from $35 to $50 per bag while the cost for Roundup herbicide has increased from $15 to $50 per gallon. “A lot of farmers are upset with Monsanto,” Shannon says.
“It’s cheaper for farmers to plant non-GMO beans if they can limit their inputs and still capture a good price for their production,” Daley says.
“Non-GMO seed varieties are now available at significantly lower prices than Roundup Ready lines,” Lickteig says.
Lickteig also sees more farmers planting soybeans this year than corn. ‘With high inputs costs for seed, fertilizer, and herbicide, farmers are seeing the benefits of lower costs associated with putting in a non-GMO soybean crop compared to corn.”
Increasing problems with weeds becoming resistant to Roundup/glyphosate is also a concern for farmers. “They are using more herbicides, which is an added cost,” Schapaugh says.
The organic food industry is also spurring demand for non-GMO soybeans, says Craig Tomera, production agronomist/crop production manager at Northland Organic Foods. “Organic food companies are switching to non-GMO soybeans until prices for organics drop and the economy improves.”
Seed challenges
The non-GMO soybean market faces challenges, especially with seed. With the big emphasis on GM soybeans in recent years, many private seed companies have focused their breeding efforts on GM varieties and phased out non-GMO.
“Seed companies are pushing GMO seed and so choices and quantities for non-GMO seed are getting less and less available,” Bradley says.
“Seed is in short supply with high yielding non-GMO soybeans simply due to supply and demand,” Daley says.
Shannon says the seed industry prefers selling GM seed because of the technology fee requiring that farmers buy seed every year; farmers can often save seed from non-GMO varieties. “The seed distributors don’t want to go back to selling non-GMO. They want to sell seed every year; it’s more profitable.”
However, good non-GMO soybean seed varieties are becoming available through some private companies in the US and Canada and through many US universities.
For those farmers wanting to jump on the non-GMO bandwagon, the time to act is now. “We are telling farmers that if they are interested in growing non-GMO, they better find a buyer now,” Albertson says.
For a list of companies buying non-GMO soybeans, visit www.soybeanpremiums.org.
