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Seed companies offering more financial incentives

By DOUG SCHMITZ
Iowa Correspondent

AMES, Iowa — While trans fat-free products continue to fill grocery shelves, U.S. farmers are offsetting the low soybean prices by planting specialty beans for these products – especially since major seed companies are still offering financial incentives to woo more farmers to grow for low-linolenic oils.

“The premium (farmers) can realize is attractive,” said Walt Fehr, an Iowa State University Charles F. Curtiss Distinguished Professor of Agriculture and Life Sciences who specializes in soybean breeding and genetics, developing the world’s first trans-free soybean.
“Contracting acres for the specialty oils is easier for the coming season than that of 2008. The amount of the premium is a major factor in the decision of the farmers.”

Low-lin oils became the latest healthy food rave a few years ago when such companies as St. Louis-based Monsanto Co. and Des Moines-based Pioneer Hi-Bred International, Inc. both launched high-yielding soybean varieties aimed at providing trans fat-free alternatives to saturated fat-laced vegetable and cooking oils.
On Jan. 1, 2006, the U.S. Food and Drug Administration mandated that trans fat labeling be on all food products, which resulted in the demand for low-linolenic soybean oil. With American farmers still trying to decide the exact mix to plant between corn and soybeans, Monsanto’s Vistive soybeans are an attractive option, said Malin Westfall, the company’s U.S. quality soybean trait marketing manager.

“The ability to earn up to a per-bushel premium does add increased earning potential for farmers,” he explained.

First launched in the fall of 2004 for the 2005 planting season and processed by Cargill, Vistive soybeans, which carry the Roundup Ready trait, contain less than 3 percent linolenic acid, compared to 8 percent for traditional soybeans. Westfall said this special process results in more stable oil that offers better flavor and less hydrogenation, which leads to zero trans fats – and higher profits for farmers who contract with Monsanto to plant and harvest the specialty beans.

“Growers that decide to grow Vistive soybeans can garnish up to a 60-cent per bushel premium,” he said. “They also have significant choice, in that they can choose maturities from a 2.2 to 3.6 that are offered by more than 25 different seed companies. They also have the benefit of choosing from hundreds of processor or elevator locations throughout the Midwest.”

Like Fehr, John Muenzenberger, Pioneer’s senior business manager, said current soybean prices can provide an even greater incentive to grow specialty soybeans, often earning growers premiums above commodity prices while increasing their soybean acre income.

Pioneer’s new Y Series, which debuted earlier this month, represents a step-change in soybean productivity and is the result of a proprietary matrix of traits and technologies Pioneer researchers have developed to deliver substantial productivity gains, Muenzenberger said.

Growers of Pioneer brand 3 percent low-lin soybeans can receive a premium of 50-60 cents per bushel at participating originators, Muenzenberger added.

In addition, a premium of up to $1 per bushel is available for the 1 percent ultra low-lin varieties with the Roundup Ready trait contracted through Iowa City, Iowa-based ASOYIA.

“The new low-linolenic soybeans in the Y Series line have shown yield advantages over previous low-linolenic products,” Muenzenberger said. “Pioneer is introducing five new low-lin soybeans within the Y Series lineup with strong defensive traits.”
Now entering its sixth year, Pioneer’s low-lin soybean contracting program has expanded from Iowa to Illinois, Indiana, Ohio, Michigan, Missouri, Pennsylvania and Wisconsin.

“We have had satisfied customers around the country with the current low-lin soybean program, and they are asking us about the next healthy oil soy product in the pipeline,” Muenzenberger said. “Our customers are becoming excited about the next generation of healthy oil products: High-oleic soybean, which we expect to have regulatory approval in 2009.

“We believe the newer products we’re introducing provide competitive yields to complement the attractive premiums and many growers are seeing the value in this program,” he added. “Also, some farmers like to participate in growing and providing a healthier food ingredient for the consumer marketplace.”

1/21/2009