MINNEAPOLIS, Minn. — There is money to be made growing non-genetically modified crops, according to a company that sells them.
SunOpta’s cost-revenue comparison shows that U.S. soybean growers would be better off growing non-GM varieties next year rather than conventional soybeans.
That is because of the price premiums farmers receive for growing non-GM crops and to the lower seed costs.
SunOpta is a $1.2 billion publicly traded company that deals exclusively with non-GM and certified organic products.
It is a fully integrated company that does everything from providing seed to farmers to selling packaged products to consumers.
Read Also
Green lentil market oversupplied
Farmers in Western Canada can expect price pressure on their new crop of green lentils, as the available supplies among the world’s major lentil-growing nations increase significantly.
The company contracts with 5,000 to 10,000 farmers around the world and sells products to 3,000 customers.
It handles 150,000 tonnes of soybeans and 200,000 tonnes of corn a year.
Kate Leavitt, director of soybean sales with SunOpta, said seed costs are 12 to 25 percent lower for non-GM soybeans than conventional Roundup Ready varieties.
Chemical costs are typically higher because non-GM growers use a pre-emergent application followed by one or two post-emergent applications.
“Why is Roundup Ready so popular? It is a very effective system in many ways,” she said.
However, it depends on whether the conventional farmer is wrestling with glyphosate tolerant weeds.
“Then, in fact, your chemical costs for biotech could be the same or more than a non-GM variety,” Leavitt told the recent Oilseed & Grain Trade Summit.
On the revenue side of the equation, she applied a 75 cent per bushel premium for growing non-GM average protein soybeans and a $1.50 per bu. premium for growing lower-yielding non-GM high protein soybeans.
Leavitt used a yield of 50 bu. per acre for both the Roundup Ready and non-GM average protein soybeans and a yield of 44 bu. per acre for the non-GM high protein soybeans.
The result is an estimated 2016 net income of $330.86 per acre for growing Roundup Ready conventional soybeans, $359 for non-GM high protein soybeans and $391.36 for non-GM average protein soybeans.
The U.S. Department of Agriculture estimates six percent of the U.S. soybean crop is non-GM, which would amount to 6.2 million tonnes this year.
Global sales of non-GM food and beverages amounted to $550 billion last year, according to the market research firm Packaged Facts. It expects that number to double by 2019 because of a 15 percent compound annual growth rate.
In May, SunOpta became the first company to receive non-GM process verification from the USDA for its processing plant in Hope, Minnesota.
Leavitt said some of SunOpta’s customers are not necessarily opposed to GM food; they just believe that 20 years is not enough time to judge the safety of a new technology.
“I have customers whose companies are older than the United States of America,” she said.
“They simply have a different view of looking at time frames and they’re not saying it’s not safe. They’re saying, ‘let’s have another decade or century to study it.’ ”
sean.pratt@producer.com
