It is time for soybean buyers to change the way they value the crop, says the U.S. Soybean Export Council.
Buyers have been using a crude protein test developed in 1860 as the main parameter for determining the value of soybeans from different origins.
Soybeans from the United States are more expensive and have lower crude protein levels than competing product from South America, putting them at a competitive disadvantage when using traditional valuation techniques.
But those techniques ignore some of the other valuable attributes of U.S. soybeans, said Jim Sutter, chief executive officer of USSEC.
“For years we’ve heard anecdotal evidence that U.S. soy is better than soy from other origins,” he said during a presentation at the 2021 virtual Commodity Classic conference.
“We’ve heard the chickens know the difference or the pigs know the difference.”
A meta-analysis comparing nearly 2,000 soybean meal samples from origins around the world has shown that indeed, not all soybeans are created equal.
While U.S. soybeans have lower crude protein content than those from South America, they have higher energy levels, better concentrations of amino acids and reduced levels of trypsin inhibitors.
“We need to showcase to people that the origin truly does make a difference and this study brought that to light,” said Sutter.
However, they needed a way to convey that information to feed manufacturers and livestock producers in a way they could understand.
USSEC partnered with Genesis Feed Technologies to create the Soy Nutrition Value Calculator, a tool that calculates the value of soybean meal based on all of the components, including energy and amino acid levels.
“It shows them in dollars and cents terms which soy they ought to buy, and most of the time it highlights U.S. soy as being the best value,” said Sutter.
Matthew Clark, principal of Genesis Feed Technologies, said it took more than three years to develop the calculator.
It uses a wide variety of parameters including crude protein levels, energy levels, amino acid content, colour, amount of damaged kernels and of course price to determine the value of soybeans from various regions of the world.
Clark said soybeans are fed to monogastric animals that don’t need crude protein as much as they need digestible amino acids and energy.
U.S. soybeans are five percent higher in energy than those from Argentina and three percent better than those from Brazil.
The upshot is that while U.S. soybean meal costs more, feed formulators can use less of it in their rations and they also need to use less fat in the diets.
“When we formulate with U.S. soybean meal we use less soybean meal. It’s a higher quality product,” said Clark.
U.S. soybean meal is more expensive, and purchasers in general are resistant to higher prices, he said.
“But when you show a general manager that their feed cost comes down if they spend a little more, they sit up and they take notice.”
The calculator shows that a broiler chicken operation using 5,000 tonnes of feed can save US$48,930 per month by using U.S. soybean meal compared to soybean meal from Argentina.
Looking at it another way, they can afford to pay a premium of $31.65 per tonne for U.S. soybean meal and have an identical total cost as they would using product from Argentina.