New use for soybean oil paving the way for improved demand05/02/2019 | Soybean News, Economics
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By Lauren Houska, ISA communications specialist
Beep beep — a new use for soybean oil is coming through!
Iowa State University (ISU) researchers are closing in on the commercialization of a bio-based polymer that can replace the petroleum-based polymers currently used as the binding agent in asphalt.
This is good news for U.S. soybean farmers who need a win amid ongoing trade disputes, a renewable fuels standard in limbo, a Chinese hog herd decimated by African swine fever and increased global oilseed supplies.
“Soybeans are highly dependent on international markets,” said Rolland Schnell, an Iowa Soybean Association (ISA) district director. “Any time we can use our product domestically, it gives farmers a little more certainty.”
The Newton soybean farmer has served on the board of directors for eight years. He was serving when ISA and the United Soybean Board each invested $125,000 in checkoff funds in bio-polymer research at ISU several years ago. To date, more than $13 million in private, state and federal funds have been leveraged to bring this technology to market.
“Like the hard-fought growth of the biodiesel industry over the years, soybeans need a real boost from something right now,” Schnell said. “I can really see this new use as being that next big, high-volume use to really give us that boost.”
It’s more important than ever to make investments to improve demand for U.S. soybean oil, Schnell said, as excess supplies continue to dampen soybean prices.
The United States produced 22.6 billion pounds of soybean oil 2017, with an average price of 32 cents per pound, according to U.S. Department of Agriculture data. Domestically, 21 billion pounds were used in food and industrial products. Comparatively, the country produced 20.6 billion pounds 10 years ago but averaged 52 cents per pound.
A biodiesel study shows a 12.9-cent increase in the price of soybean oil per pound, which equates to a 74-cent per bushel increase in soybean prices. It also equates to a $25-per-ton decrease in the cost of soybean meal, which is advantageous for Iowa’s livestock farmers, Schnell said.
Opportunity for oil
ISU Chemical and Biological Engineering professor Eric Cochran, pictured above with process engineer Mike McMahon (left) and ISU professor of civil, construction and environmental engineering Chris Williams (center), expects demand for soybean oil to soar once commercial sales take off.
Cochran, the lead on this project, said there are about 1.6-billion pounds of oil used in the polymer binders annually from three market segments combined — polymer-modified pavements, pavement rejuvenation and road maintenance products.
Given the durability and environmental advantages over more expensive petroleum-based polymers, he says it’s not unrealistic that hundreds of thousands of tons of soybean oil could be utilized annually.
“We’re competing against petroleum-based polymers that cost between $2-$4 per pound and whose key ingredients, butadiene, is largely imported from Asia,” Cochran said. “We’re offering a domestically-produced soy-based alternative that performs as well or better and will cost about $1 per pound.”
Testing the tech
After years of research-scale development and testing at ISU’s Bio-Polymer Processing Facility at the BioCentury Research Farm, the product entered the testing phase in November at the National Center for Asphalt Technology (NCAT) Test Track.
A 1.7-mile oval in Opelika, Alabama, the track is comprised of 46 main test sections sponsored on three-year cycles. The track is circled by a fleet of heavily loaded trucks resulting in 10 million equivalent single axle loads of traffic. The performance of each test section is closely monitored over a period of two years.
Participating in NCAT are 22 state departments of transportation — including the Iowa Department of Transportation — as well as 20 national companies. If tests go well, it could launch a broader reach and market for the product, Cochran said.
“Commercial sales come after the testing and regulatory hurdles have been addressed,” Cochran said. “If your NCAT demo goes well, you’ve essentially got 22 states that aren’t worried about allowing your product to be used, plus you could have companies that could be interested in buying the product. It’s good public relations if things go well.”
“We have taken what we learned from plant operations and identified bottlenecks and processing steps that would add costs and figured out how to eliminate those things,” Cochran said.
He said the next steps are to scale up and sell, which is what they are working toward this year. Potential manufacturers of the product want to see that there is real demand for this product before they commit to large-scale production. Potential customers want to see how well the product works before buying. This all requires real-world demonstrations.
“This summer we will be working on paving demonstrations across several states,” explained Cochran. “Local demo projects get other state agencies on board and familiarize potential customers, like regional contractors and terminal suppliers, with the benefits of the product.”
The first project will be in Cedar Rapids in July. They will also soon have projects in Tennessee, Minnesota, Alabama, Wisconsin, Nebraska and Kansas.
This progress is encouraging, Schnell said.
“It’s taken longer to get this product off the ground than we originally hoped, which can be frustrating as farmers are searching for new revenue opportunities,” Schnell commented. “But it seems that the stars have really started to align for this checkoff investment to start paying off.”
He believes ISA should continue to support the development and promotion of this new opportunity.
“We have supported the development of the biofuel industry for years, which has paid off,” Schnell said. “We need that same energy when it comes to new use projects like this one.”
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