Suppliers see strong farmer interest in non-GMO soybeans

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Suppliers see strong farmer interest in non-GMO soybeans

Suppliers of non-GMO soybeans and seeds see strong interest among US farmers in growing non-GMO, but many see fewer non-GMO soybean acres in 2010 due to an oversupply and lower premiums paid to farmers.

Most suppliers surveyed say that farmer interest in growing non-GMO soybeans remains strong. "We continue to get calls from people wanting to grow conventional non-GMO soybeans," says Mac Ehrhardt, co-owner of Albert Lea Seed House.

"More farmers are asking about non-GMO soybeans, and actively ordering," says Art Scheele, owner of American Organic Seeds.

Reduced acres in 2010

While strong interest remains, some suppliers don't see that translating into increased non-GMO acreage in 2010. "Interest is there, but because there is an excess of non-GMO soybeans in the marketplace and premiums are lower, it is doubtful this interest will result in acres being planted," says Darwin Rader of Zeeland Farm Services, Inc.

Several suppliers say that an oversupply of non-GMO soybeans in Japan, the biggest market for food-grade non-GMO soybeans, will reduce the demand and acreage in the US this year.

"I think the total number of acres will be down as premiums have decreased from last year. The Japanese market is working through an oversupply from the 2009 crop which resulted in less demand and lower premiums," says Joe Taft of The DeLong Company.

"Right now there is a severe oversupply of non-GMO beans in the Asian market," says John Trewartha of Specialty Grains.

Another contributing factor to fewer non-GMO soybean acres is the lower price for glyphosate/Roundup herbicide, which will encourage more farmers to plant genetically modified Roundup Ready soybeans. "Acreage of non-GMO beans will decline in 2010 because Monsanto has lowered the price of Roundup herbicide to compete with generics," Trewartha says.

"The low cost (for glyphosate) is compelling to farmers and it's hard to get them to grow non-GMO unless they can get a big premium," Ehrhardt says.

"Year of correction"

Corey Nikkel, vice president of marketing at eMerge Genetics, a supplier of non-GMO soybean seed, sees 2010 as a "year of correction" for non-GMO soybean production. "I think this year will be a year for maintaining, but it will be back on track next year," he says.

Rader sees a cyclical pattern in the demand for non-GMO soybeans. Farmers saw higher premiums in 2009 and high yields led to the current oversupply, which is pushing down premiums. "My best estimate is that non-GMO acres for 2010 will be down, thus driving down the supply and resulting in premiums that will probably be driven up in 2011."

Trewartha sees the same scenario. "I expect that after the 2010 crop is planted and harvested, buyers will be seeking non-GMO beans and supply will be short."

"Independence, purity, and responsibility"

Over the long-term, Nikkel says the market for specialty non-GMO soybeans will continue to grow.

Allan Spicer of Canada-based Can Grow Crop Solutions, Inc. sees a "major swing" among many of his farmer clients who are switching from GM to identity preserved non-GMO soybeans. The premiums for growing non-GMO have been a factor, but yield drag with Roundup Ready varieties along with the availability of new herbicides are other factors, he says.

Rob Prather of Huron Commodities says many farmers want to plant non-GMO soybeans but feel they are at the mercy of large seed companies. "They need the high yields to satisfy the landlord or the bank/investment company and then they have to use certain chemicals and certain seeds to satisfy all investors. So, there is a feeling of loss of control of one's own farming operation."

On the other hand, Prather says non-GMO farmers have a lot to gain "by profiting from premiums, traditional weed management, higher than expected yields, and use of on-farm storage facilities."

"Non-GMO represents the independence, purity, and responsibility that most farmers want. It's sort of the way farming was, and in some minds should still be," he says.