New and Industrial Uses Support Soy Demand
Once they leave the farm gate, there’s a world of potential for soybeans from South Dakota and all U.S. soybean-producing states. As one of the world’s most versatile crops, the majority of U.S. soybeans seem destined for export markets or domestic livestock feed, but an increasing number are used in a wide range of industrial and innovative ways.
According to a United Soybean Board (USB) economic analysis, animal agriculture uses 97 percent of all the soybean meal consumed in the United States, making it the number one soybean customer. Soybean meal use for U.S. animal ag rose to 34.3 million tons or about 1.4 billion bushels in 2016, according to SoyStats. Meanwhile, the U.S. Department of Agriculture’s (USDA) March 2018 World Agricultural Supply and Demand Estimates (WASDE) projects soybean exports in the 2017-2018 marketing year at 2.065 billion bushels.
The livestock and export sectors may be the heavy hitters, but industrial demand helps to round out the soybean use lineup.
“Industrial uses are really a portfolio-broadening exercise,” says Keith Cockerline, USB director of industrial uses. “They help to shore up the value of soybeans because just selling a raw commodity is not capturing as much value. The more processing done in the U.S., the more value we create.”
According to USB, annual industrial demand for U.S. Soy increased from 14 million bushels in 2003 to more than 111 million bushels over a decade later. Soy-based products offer an attractive, competitive and greener alternative to petroleum as companies strive for increased sustainability and a reduced carbon footprint.
Cockerline says the U.S. Soy industry lost a tremendous amount of oil market share due to trans-fats labeling requirements in the mid-1990s. Soybean oil requires partial hydrogenation for many food applications, which results in trans-fats. Therefore, many ingredient companies searched for a replacement, resulting in substantial lost market share. More recently, the Food and Drug Administration determined that partially hydrogenated oils are no longer “generally recognized as safe” and required food companies to eliminate them from their ingredient lists by June 2018. This further impacted the small remaining amount of partially hydrogenated soybean oil in the marketplace.
The development of a domestic biodiesel industry played a vital role in maintaining a market for soybean oil. The USDA estimates approximately 7.5 billion pounds of soy oil will be converted to biodiesel this year. Nationwide, the biodiesel market tops 2.65 billion gallons annually. “Biodiesel really stepped in and saved the oil market,” Cockerline says. “It’s the biggest player in the industrial space for soybean oil.”
Cockerline says many industrial uses for soy oil are starting come into their own. For example, Goodyear Assurance®WeatherReady®tires made with soybean oil are now available to fit 77 percent of all passenger vehicles on the road. Goodyear introduced a new soy-based tire line specifically for police cars and other pursuit vehicles.
The soy checkoff worked with Ford to develop soy-based foam for their car seats. Every Ford vehicle built in North America since 2011, totaling about 18.5 million vehicles, contains soy-based foam in seat cushions and seat backs.
John Deere has manufactured soy-based polymers for use in tractor and combine hoods and exterior panels since 2001.
Soybean oil used for rubber and plastics is growing to include toys, boots and machine parts. WCCO Belting of Wahpeton, North Dakota, uses soy-based rubber for draper combine header belts as well as baling equipment and conveyors.
Stains, ink, adhesives, carpet backing and even personal care products offer avenues for soy oil use. The soy checkoff also worked with Sherwin-Williams to develop paints made from soy oil that exceed Leadership in Energy and Environmental Design requirements. The paints won the U.S. EPA 2011 Presidential Green Chemistry Award by reducing volatile organic compounds (VOCs) by 60 percent.
“We’ll never be able to replace petroleum unless soy products can be cost-neutral or better and deliver technical advantages,” Cockerline says. “Companies are trying to reduce their carbon footprint, and soy offers reduced VOCs and improved wear characteristics. It sounds good to says a product is biobased, but it has to be cost effective.”
Cockerline points to South Dakota’s Prairie AquaTech as an example of an exciting new use for soybean meal. Prairie AquaTech recently broke ground on a new facility to produce microbially processed soybean meal for fish feed. The plant will function as a biorefinery that breaks soybean meal into its component parts. Cockerline says the process will make it possible to produce base chemicals and fatty acids that could have multiple high-value uses.
Chicago-based ARRO Corporation is building an industrial isolate plant that will use soybean meal to produce materials for paper coatings and label adhesives. The ARRO plant is expected to come online in September.
Cockerline says there are soy-based products in development that will help make agriculture safer and even protect pollinators.
Animal agriculture and exports will always be important markets for U.S. soybeans. It’s also key to find and develop potential new uses and industrial markets using soy as a raw material to creating demand and enhance soy’s value.
“I really look forward to the potential for development of high-value downstream products,” says Lewis Bainbridge, South Dakota farmer and USB chair. “The future looks promising for increased soybean use.”
“Much of what we do is push the envelope on the science behind soy and try to make it a preferred bio-based material. This takes time and money,” Cockerline explains. “The idea behind new uses is to expand our portfolio, support prices and get soy into more markets as a preferred, sustainable source for protein and oil.”
Cockerline says USB continues to invest in new uses and industrial product development because the future is bright for moving soy into innovative places. “The next wave of new uses coming is even more exciting.”
This story originally appeared in the July/August edition of the South Dakota Soybean Leader. Please click here to see the original story.