Expanding Global Soybean Markets03/12/2019 | Soybean Exports, Soybean News, Economics
By Katie Johnson, ISA public relations manager
Cruise ships, ocean liners, barges and cargo ships pass through a bustling Panama Canal in early February. Where the rest of the world keeps turning, one frequent visitor through the Canal walls sits starkly quiet. Panamanians historically welcome at least sixty boats of soybeans this time of year. To date, they have only seen one. Clearly, the United States and China aren’t the only countries adversely impacted by the ongoing trade war.
Iowa Soybean Association (ISA) Chief Operations Officer Karey Claghorn recently returned from a trade mission to Colombia and Panama. Traveling with representatives from the Iowa Pork Producers Association and Iowa Corn Growers Association in addition to Lieutenant Governor Adam Gregg and Iowa Secretary of Agriculture Mike Naig, Claghorn reports this mission was a valuable opportunity to see Iowa agricultural products consumed abroad — and potentially capitalize on a growing market.
“These countries are smaller markets, but they are growing. We need to see which markets we can further tap into,” Claghorn says.
The United States holds a free trade agreement with both Colombia and Panama. Colombia is the fourth largest country by population in Latin America and continues to grow.
Claghorn reports that 90 percent of Colombia’s pork and soybean imports are from the United States.
“Walking along supermarkets we saw Blue Bunny Ice Cream from Le Mars and Hormel pepperoni produced in Osceola. We saw cooking oil expressly labeled as soy.”
Due to Colombia’s terrain, it is logistically easier and more cost effective to import soybeans than attempt to grow the crop themselves. Speaking with entrepreneurs and food suppliers, Claghorn reports that Colombians are excited to do business with the United States. That excitement, Claghorn asserts, drives relationships. And when it comes down to it, “you buy from people you know.”
“Our farmers are our best ambassadors. When buyers can put a face behind the pork products or soybean meal, customers think of those farmers when making purchasing decisions,” Claghorn says. “We met with people who make those purchasing decisions and it gave them the opportunity to ask our farmers questions and pass that information down the supply chain. Relationships make the difference.”
ISA President Lindsay Greiner is one of those farmers making an international difference.
“With all things being equal, trade comes down to relationships,” says Greiner as he reminisces on several trade missions from the last few years. “People do business with people.”
Greiner has served as a trade representative in the Philippines, Vietnam, Germany, Poland, Italy, Norway, Egypt, Spain, Mexico and China.
As a farmer traveling the world promoting U.S. soy, Greiner sees first-hand the many perceptions of U.S. agriculture and proudly regales a theme of general positivity.
“Perceptions are very good. If you tell them you’re a farmer from Iowa, they know we have the best land in the world,” says Greiner. “They know we are progressive farmers who embrace technology to improve our practices through time.”
For soybean leaders like Claghorn and Greiner, the importance of these trips cannot be overstated. As a continued trade-stalemate impacts soybean farmers’ abilities to sell to China, expanding markets elsewhere is a primary objective of the soybean checkoff.
“I wish it were as simple as getting a call from that country the Monday we get back and they tell you they’d like to purchase all our soybeans,” Greiner laments when asked about the effectiveness of these trade missions. But results take time.
Recalling his recent trip to Barcelona, Spain for a global soybean buyers conference, Greiner detailed his discussion with a fellow farmer about the results of such trade missions.
“I asked him how much good comes out of these trade missions and he said, ‘I’ll tell you the good we’d be doing if we weren’t here — none.’”
In addition to establishing trade relationships, Claghorn comments the global perspective helps U.S. agriculture remain competitive.
“We learn about these international markets and what they really need. How are they using our product? What challenges are being had? Can we improve things here?”
Claghorn recalls Panamanians being concerned for their upcoming Presidential election in May. Several candidates are calling into question their free trade agreement with the United States. Deriving 30 percent of its Gross Domestic Product from the Canal, Panama is one of many countries adversely impacted by a lack of trade.
As U.S. soybean farmers know, trade is a backbone of their bottom line. Trade agreements with other countries remain imperative as the soybean market struggles to gain back the $2 decline from the last twelve months of Chinese trade tensions.
As Greiner prepares to once again visit China at the end of March, his thoughts on relationship building, even within a tumultuous trade partnership, remain steadfast.
“I really hope we get a trade deal worked out with China and I know trips like this get us closer. It will be one year since I was there last, so it will be interesting to see their perception of everything from the last year. I’d like to know some of the prospects of getting that market share back, should a trade deal be worked out.”
Agriculture and international diplomacy continue to go hand-in-hand when it comes to trade.
Claghorn sees trade missions as a vital part in that diplomacy, asserting that “having a relationship with a customer is what will keep them buying.”
Contact Katie Johnson at email@example.com.
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