It’s a new kind of war over oil.
The United Soybean Board in the United States is excited about a new high oleic soybean that it thinks will compete in the edible oil market with Canadian canola.
It may have a point, since the USB is throwing $60 million at the new crop, along with partners DuPont Pioneer and Monsanto, to get it right. Even in the world of high-tech crop development, that’s a lot of money, representing about two-thirds of the soybean checkoff.
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To put that in perspective, the price tag also equals 20 percent of the federal Canadian agriculture budget dedicated to research, adaptation and innovation.
American farmers have deep pockets, and when they put their money and their resolve behind a crop, Canadian industry must take notice. It would be helpful if the federal government would pay attention, as well.
The new high oleic type has emerged because U.S. soybean growers are determined to regain some of their market share in edible oil. They have lost 28 percent of the American market to canola and palm oil, at the incredible rate of 1.8 million tonnes every year since 2008.
Processors are moving away from trans fats in partially hydrogenated oils used in processed food and fryers, where highly stable oil is needed.
The USB hopes that the new varieties will make up 30 percent of the massive soybean crop by 2020.
At least one industry spokesperson says “the battle is on” for the edible oil market. However, said Dave Dzisiak of Dow AgroSciences, the threat to canola oil is not as dramatic as it might seem.
Firstly, the U.S. market is not self-sufficient in vegetable oil. Secondly, soybeans are grown more for protein than oil. And thirdly, high oleic canola tastes better, is lower in saturated fats and has an established track record, he said. It would also be a big change for food manufacturers to switch to a different oil with a different taste and processing properties.
Still, the threat from new soybean types to Canadian canola farmers is there, and it is not the only one. Indeed, the biggest threat to canola may be canola. U.S. farmers are starting to grow more canola, and with their climate, may be able to improve on Canadian yields if they can nail down the seeding and harvest timing.
Even if a full-blown battle does not develop, the Canadian canola industry — and preferably, the federal government under its innovation agenda — would be wise to step up protection of this major crop.
Eighty-five percent of Canadian canola is sold to markets around the world, and is worth billions of dollars to Canada. The biggest buyer, of both oil and meal, is the United States at $2.6 billion, while raw seed goes mainly to China, Japan and Mexico.
It’s a big market, and canola is seeing its share of problems. Further research is necessary into canola agronomy, particularly into reducing shattering and improving canola’s water and nutrient uptake capabilities.
The Canola Council of Canada has done an impressive job of marketing western Canadian canola, but in this environment, even more might have to be done to maintain Canadian canola’s reputation as the best oil grown in the cleanest environment on the finest land.
It is also a very stable oil, excellent for food processing, and is low in saturated fats.
In addition, new canola varieties could be developed to contain higher nutritional — and even nutraceutical — content, including the widest range of omega fatty acids.
High oleic soybeans are a new threat to the Canadian canola industry, although U.S. canola may be a bigger one. Either way, western Canadian canola’s journey to agronomic and nutritional improvement must continue, along with the marketing to support it.
