I met a few minutes ago with two Asian food industry journalists and, as always when I meet overseas customers of Canadian crops, I come away relieved that Canada has a good reputation for quality product and intimidated about how closely they watch their suppliers and analyze our products.
They are on a cross-country tour organized by the Canadian Soybean Council and they’ve been checking out fields and the industry in Quebec, Ontario and Manitoba. This morning they’re in Winnipeg meeting with officials of the Canadian International Grains Institute.
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I wondered why they would be interested in Canadian soybean production at all, considering the vast size of the export soybean crops produced by the United States and Brazil, but Japanese journalist Chiaki Terada of the Daily Soybean and Oil Seed News told me that Canada is still able to supply GMO-free soybeans, and that’s a critical requirement of Japanese soybean food processors. Oilseed crushers don’t care about GMO soybeans, but for those making miso soup, tofu and other major Asian products, GMO is something they avoid. Canada produces about two-thirds GMO soybeans and one third non-GMO, but the soybean industry’s traceability system makes Japanese buyers feel confident with the non-GMO soybeans they order.
Terada also told me that Japanese buyers are happy to see soybeans spreading into the prairies, because a wider production base will relieve their worries that some bad weather event some year will drastically reduce supplies. They’ve been worried this year because of the weird North American summer, so anything that spreads that weather risk out is good by them.
It hasn’t been a happy time in Asian food processing companies, the journalists told me. The wild volatility has made it hard for all companies to know how to price and market their products. Terada said the companies can handle high prices if they are consistently high, but when they soar through the roof and then slump it can shove companies that bought or sold at the wrong time into business problems and even business failure. I told them that farmers here have trouble figuring out their business futures when prices have soared and slumped so dramatically in the past two years. Are crops going to reach a higher level of prices that justify investing a lot in a farm? Or are we heading back to the kind of l0w-margin prices that would tend to restrain investment enthusiasm? Just like with Asian food processors, farmers don’t know.
I always ask foreign buyers (or journalists who cover them) about Canada’s reputation as a crop supplier, and I make sure I’m not acting like I’m fishing for them to compliment Canada. But invariably I’m told that Canada’s reputation for quality grains, oilseeds and pulses is excellent, and usually, as today, I also get a broad and quick smile as soon as I ask the question. This country really does seem to have a good rep overseas, and that helps us compete with the big boys of soybeans – the U.S. and Brazil – in getting into those lucrative Asian markets. We may not be able to compete on size with the giant soybean exporters, but it’s good to know that buyers who make that extra effort to buy Canadian crops feel good about it afterwards.
