DRESDEN, Ont. — Food-grade, non-genetically modified soybeans have propelled the Hensall District Co-operative into the No. 1 export position.
“We are the biggest exporter of food-grade beans (soybeans and edible beans) in North America and in food-grade soybeans. There’s no one in the states that does more than us,” said Jason McNaughton, the co-op’s identity preservation soybean marketing manager.
“I don’t think there’s one single big factor behind this, but we are really focused on food grade. We’ve focused on our growers to be food producers, and our processing quality is the best. We have a good reputation in the end-user market.”
Other Ontario players in the trade also have the necessary emphasis on quality, including what may be the province’s No. 2 player, Sevita International Corp., and Jackson Seed Services in Dresden.
They and a handful of smaller companies compete for growers. This year, those growers are enjoying premiums of $2 to $5 per bushel.
Frank Backx at Hensall and Dennis Jackson at Jackson Seeds said food-grade, non-GM varieties tend to yield as well as their glyphosate-tolerant cousins, despite claims to the contrary.
The notable exceptions are varieties with the highest protein levels, which fetch the highest premium to make up for any yield lag.
“The Roundup Ready gene does not make soybeans yield more. That’s fictitious,” Backx said.
Growers can expect to take a hit on their premiums next year, perhaps by 25 to 50 cents in Backx’s estimation. As Chicago Board of Trade prices soften, so do premiums.
“Growers want to get so much money per acre,” Backx said.
“If beans are $15 a bu., they’re happy to grow Roundup Ready. It’s easy. But if beans are $9, many of them need that extra premium to make ends meet,” he said.
Demand for food-grade exports from Ontario and Quebec is expected to increase as the price of commodity beans drops. McNaughton said the increased demand is from South Asian countries outside of Japan, including Indonesia, Vietnam, Malaysia, Indonesia, the Philippines, Taiwan and Hong Kong.
McNaughton said the market in Japan for non-GM, food-grade beans is slowly softening as the Japanese adopt western eating habits.
Still, Japan remains the world’s premium market for food-grade soybeans. Ontario and Quebec hold the biggest share of that market.
There’s also enormous export potential for food-grade soybeans in China.
In the past, most Canadian food-grade soybeans reached China through Hong Kong, McNaughton said.
However, Hensall now ships direct to a buyer in mainland China through a special arrangement that deals with any containers that may contain GMOs.
McNaughton said China has an official zero-tolerance policy for GM soybeans. All soybeans grown in the country are said to be GM free, though he doubts the claim.
Non-GM beans represented 20 percent of Ontario’s 2.5 million acre crop last year. Most of those went to the food-grade market.
This year, a record three million acres are expected to be harvested in the province.
Prices were strong earlier this year and adverse planting conditions led Ontario farmers to switch to soybeans from corn.
Average yields are expected.
Hensall Co-op is headquartered in Hensall, a hamlet in Ontario’s Huron County. Edible beans are shipped to the co-op from Ontario, Manitoba, Michigan, Minnesota and North Dakota. Most of its non-GM, food-grade soybeans are grown in Ontario.
Jackson Seed Services is a family-operated business founded in 1978. It specializes in food-grade and seed soybeans.
Jackson said the business began as a one-man operation and today includes three processing plants, the latest going online this fall.
“There was nothing here but a field of soybeans when I started,” he said.
Sevita International was formed in January 2012 when four companies merged: Hendrick Seeds, Hendrick Agriworks, PRO Seeds Marketing and Agworks Inc. The company has facilities in Inkerman, Ont., and Woodstock, Ont.
The major Quebec players in the food-grade trade are Bunged Du Quebec, La Co-op Fédérée and Ceresco.