Iowa Soybean Association videocast also explores prospects for domestic livestock growth
Ankeny, Iowa — Add a shrinking pig herd in China to a continued trade war, historic planting delays and record global supplies and you have the perfect recipe for the U.S. lowest soybean prices in more than a decade.
But growth opportunities in domestic meat production and a renewed interest in farmers diversifying their operations hold promise for an industry in need of some good news, say panelists participating in the latest edition of The State of Soy.
Joining in the discussion produced by the Iowa Soybean Association and hosted by ISA Communications Director Aaron Putze, APR, are:
- Brian Waddingham, Executive Director, Coalition to Support Iowa’s Farmers (CSIF)
- David Pyburn, National Pork Board Senior Vice President of Science and Technology
- Lindsay Greiner, President, Iowa Soybean Association and Keota, Iowa farmer
As much as 40 percent of China’s 400-plus-million-head pig herd is reported to be impacted by African Swine Fever (ASF). The negative impact on the country’s demand for soybean meal is still being quantified.
“U.S. soybean exports to China are off almost 90 percent this current marketing year,” says Putze. “An outbreak of a highly contagious virus among pigs resulting in mortalities inside of two weeks will only exacerbate soybean prices that have been trending lower for more than a year.”
Pyburn says no one knows for sure just how many pigs in China could be impacted by ASF as the country’s hog inventory is difficult to calculate.
“What we do know is the disease isn’t something they’re going to be able to eradicate in short order.”
Greiner, who traveled to China earlier this year, remains concerned about the potential long-term hit to demand for a crop he and many other Midwest farmers are having difficulty getting into the ground.
“We received varying reports of how many hogs the virus had impacted,” says Greiner while recalling his conversations with Chinese soybean buyers and livestock industry exports. “Even if it’s just 30 percent, that’s one-and-a-half times the number of hogs we raise in the U.S.”
Greiner has double the exposure to what’s going on with China given he produces both soybeans and pork on his southeast Iowa farm.
“We’ve got tariffs to deal with, and now we’ve got a loss in demand. That makes negotiations on a trade deal even more difficult.”
According to Iowa State University, the U.S. pork industry would sustain an $8 billion loss in the first year if ASF broke domestically. U.S. beef producers would take a $3 billion hit stemming from reduced consumer confidence in meat safety. The soybean industry was estimated to lose about $1.5 billion in the first year.
But despite the challenges posed by ASF, panelists report opportunities for optimism when it comes to livestock and domestic soybean demand. As livestock and poultry sectors consume 97 percent of all U.S. soybean meal, a thriving livestock sector adds consistency to the soybean market.
“Calls are increasing to build new barns and buildings for livestock,” says Waddingham. “More cattle are coming back to Iowa and there is even growth in aquaculture for Iowa fish and shrimp.”
Partially funded by the soybean checkoff
The Iowa Soybean Association (www.iasoybeans.com) develops policies and programs that help Iowa’s more than 40,000 soybean farmers expand profit opportunities while promoting environmentally sensitive production using the soybean checkoff and other resources. The association was founded in 1964 and is governed by an elected volunteer board of 22 farmers. It strives to be honest and transparent, fact-based and data driven and committed to environmental stewardship, collaborations and partnerships.