Iowa Soybean Review, February 2014 by Iowa Soybean Association

Iowa Soybean Association, 1255 SW Prairie Trail Parkway, Ankeny, Iowa 50023

NON-PROFIT ORG. U.S. POSTAGE PAID DES MOINES, IA PERMIT NO. 1333

Adding Value to Iowa’s Soybeans Animal Agriculture February 2014

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Going It Alone Is Overrated

Brian Waddingham CSIF Executive Director

Ben Novak Ted Novak

Working beside you... to do things right from the start

Fourth-generation livestock farmer Ben Novak was ready to join his father, Ted, on their row crop and cattle farm in Tama County. But, current land values made it diﬃcult to compete for crop ground, so a new 900-head cattle barn was the best option to bring Ben back to the family farm. The Coalition to Support Iowa’s Farmers (CSIF) was there to help smooth the way and answer the Novaks’ questions. “We wanted to do things right and not just meet, but exceed the rules and regulations,” said Ted Novak. “CSIF was a valuable resource for us. They made multiple trips to our farm to assess our current situation and served as a sounding board for us.” “The number one service the Coalition provided was helping us understand the rules and regulations as we bounced ideas oﬀ them,” said Ben Novak. “CSIF helped us take a proactive approach to reaching our goals and helping us grow our farm responsibly.”

YOUR FARM. YOUR FAMILY. OUR FOCUS.

To ﬁnd out how CSIF can help you at no cost, call or visit our website.

Scan this code to hear more from the Novaks.

CSIF28966_2_CSIF Ad campaign2013 Novak AD 8x10.indd 1

CSIF is a not-for-proﬁt, non-lobbying organization funded by the Iowa Cattlemen’s Association, Iowa Corn Growers Association, Iowa Farm Bureau Federation, Iowa Pork Producers Association, Iowa Soybean Association, Iowa Turkey Federation and Midwest Dairy Association.

800-932-2436 • www.supportfarmers.com Partially funded by the soybean checkoff.

5/30/13 4:58 PM

Iowa Soybean Association

February 2014 | Vol. 26, No. 5

About the Cover:

Central Iowa Farmers Dive Into Aquaculture

Iowa farmers like Matt Raasch of Odebolt generate $22.6 billion in revenues for the state, according to a recent economic analysis.

Aquaculture is a burgeoning business.

Livestock Provides Economic Lift to Iowans

Chickens and Turkeys:

Farmers Use Data To Turn Manure Into Profits

Adding demand for Iowa.

The Raasches’ investment is part of an industry that benefits all Iowans.

Bringing stories to life. There has never been a more exciting time to be involved in the agricultural industry and we look forward to showing you why with IOWA SOYBEAN ASSOCIATION LIVE — a new app that is bringing stories to life in the Iowa Soybean Review. In three easy steps, you’ll get a more in-depth look at Iowa soybean farmers and stories that affect our lives.

Manure may well have been the first form of fertilizer used by farmers.

Get the ISA LIVE app. Download it to your Apple or Android device by searching for IOWA SOYBEAN ASSOCIATION LIVE from your app store. Its free!

Once downloaded, start the app and hover over any photo that includes the ISA LIVE icon with your mobile device and the movie will begin to play.

Watch as exclusive stories come to life.

Iowa Soybean Association

EXECUTIVE review Kirk Leeds Chief Executive Officer Iowa Soybean Association kleeds@iasoybeans.com Twitter@kirkleeds

“Our Customers are Real Pigs” It’s true. Our customers are real pigs – and chickens, turkeys, cows, fish and shrimp! This issue of the Iowa Soybean Review is focused on recognizing the importance of the livestock and poultry industries to Iowa’s soybean farmers and to the state’s overall economy. Our economy is driven by agriculture, but the fuel for that engine is provided by our livestock and poultry producers. Without these critters, the demand for Iowa’s corn and soybeans would be dramatically lower. Unfortunately, our farmer friends who are raising these animals are often unfairly criticized and attacked by uninformed neighbors and outside agitators with political agendas. We have officials with the Des Moines Water Works supporting outrageous claims about how manure from these farms is destroying our drinking water. We have out-of-state groups running misleading and inflammatory ads across the state. The Coalition to Support Iowa’s Farmers (CSIF) was established several years ago to help family farmers deal with these issues and to work with local farmers to make sure that they are, indeed, doing things right. The Iowa Soybean Association (ISA) was a founding member of CSIF and we continue to be a major supporter. We all understand that there are some “bad actors” in the livestock industry, just as there

are in every industry. However, the vast majority of Iowa’s livestock and poultry farmers are indeed doing things the right way and ISA is proud to support them. Another benefit of the strong demand for soybean meal by our livestock and poultry farmers is that it helps balance the growing use of soybean oil for biodiesel. As you know, soybeans are processed into two major products: soybean meal and soybean oil. Ninety-seven percent or more of the soybean meal produced goes into livestock feed, while the soybean oil is the leading vegetable oil in the country. However, with the recent concerns over trans fats, we have seen a significant decline in consumption of soybean oil by consumers. Fortunately, the growth of the biodiesel industry has replaced most of this lost demand. And we can thank soybean farmers and the investment of their soybean checkoff dollars during the last two decades for helping create the market for biodiesel. If you would like to learn more about the biodiesel industry, the importance of the livestock industry or any of the other focus areas of the Iowa Soybean Association, visit our newly revamped website at www.iasoybeans.com. YOUTUBE LOGO SPECS

American Soybean Association Directors Ray Gaesser, Corning Dennis Bogaards, Pella Jim Andrew, Jefferson John Heisdorffer, Keota Mark Jackson, Rose Hill United Soybean Board Directors Laura Foell, Schaller Delbert Christensen, Audubon Larry Marek, Riverside Jim Stillman, Emmetsburg

For advertising information in the Iowa Soybean Review, please contact Larson Enterprises, (515)440-2810 or larson6@mchsi.com. Comments and statewide news articles should be sent to the above address. Advertising space reservations must be made by the first day of the month preceding publication. In consideration of the acceptance of the advertisement, the agency and the advertiser must, in respect of the contents of the advertisement, indemnify and save the publisher harmless against any expense arising from claims or actions against the publisher because of the publication of the content of the advertisement.

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Farmers adopt technology

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no gradients BLACK Review WHITE The Iowa Soybean is published eight times a year by:

Iowa Soybean Association 1255 SW Prairie Trail Parkway, Ankeny, Iowa 50023 Phone: (515) 251-8640 watermark Web address: www.soybeanreview.com E-mail: aclinton@iasoybeans.com Iowa Soybean Association can also be found on these sites:stacked logo (for sharing only)

Supporting animal agriculture through the King Amendment By Policy Director Carol Balvanz

ISA Contract Lobbyist Jill Altringer and ISA Policy Director Carol Balvanz invite farmers to join them at the Iowa State Capitol in Des Moines.

As Iowa Soybean Association (ISA) board members determine their priority legislative issues for the year, supporting animal agriculture rises to one of the top two or three. In the past five years, there have been few bills offered at the state level that required ISA’s attention. At the federal level, however, Congressman Steve King’s amendment to the Farm Bill to Protect Interstate Commerce has given us the chance to work this priority head on. At this writing, the Farm Bill has not been passed out of conference committee. If by the time you’re reading this, the Farm Bill has passed, hopefully the King Amendment survived the struggle. The King Amendment invokes the Commerce Clause which states that no state can regulate the means of agriculture production in another state. Google “King Amendment to the Farm Bill” and you will find thousands of articles and opinions about the language and the intent. Nearly every article urges defeat of this “troublesome” amendment, with many of them calling it a cruel punishment for animals. Most of the articles are posted by animal rights organizations and sympathizers, worried that this amendment could derail their strategy to allow rules passed by referendum in states such as California to dictate livestock production across the country. In 2008, California passed an initiative setting requirements for the sizes of laying hen cages. In 2010, the California legislature passed a law saying that all products imported into the state must be produced under the same requirements. They were obviously trying to protect their own egg producers, who are

now subject to expensive changes to their operations required by the initiative. According to Iowa Ag Secretary Bill Northey, California should not be allowed to dictate production standards to the rest of the country. “If eggs are safe to be sold in Iowa, they should be able to be sold in California.” Some of the amendment’s opponents have said the language would impact state laws dealing with the safety of agriculture products. However, the language is clearly limited to agricultural production methods. And the underlying voice of Humane Society of the United States (HSUS) resonates through a huge proportion of the arguments opposing the amendment. Livestock producers and supporters have spent millions of dollars trying to defeat animal production ballot initiatives in many states. HSUS continues to pursue those initiatives in states where an urban public can be easily persuaded that the size of an animal’s enclosure influences the quality of their food. Once they win that fight in a place with a major population market, it’s a simple step to legislate marketing rules to make every other state conform to their more expensive standards. Congressman King explains that this strategy fits the HSUS agenda to take animal products out of the American diet. Hopefully by the time you’re reading this article, the Farm Bill will have passed with the King Amendment intact. If not, the livestock industry, (our largest market for soybeans,) may be in serious trouble.

“California should not be allowed to dictate production standards to the rest of the country. If eggs are safe to be sold in Iowa, they should be able to be sold in California.” -Bill Northey, Iowa Secretary of Agriculture

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Be Good to Your

Heart! February is the perfect time to talk about how beneficial soy is for your heart health and to start adding soy protein to your everyday meals.

Soy protein received a health claim that says consuming 25 grams of soy protein daily in the context of a healthy diet may reduce the risk of coronary heart disease. Heart disease is still the No. 1 killer of both men and women in Iowa, as well as the United States. Questions people ask are what does 25 grams look like? How much soy is that? Is it difficult to start eating soy? How much extra preparation will it take? It is so easy to add 25 grams per day. Take a look and see what works for you. The next time you are at the supermarket, read nutrition labels and you will be amazed at how much soy protein is in lots of products. Be good to your heart this month and start adding soy

½ cup edamame and ¼ cup soynuts

= 22

grams soy protein

1 cup soymilk & cereal (includes soy protein)

= 13

grams soy protein

Soy protein bar and 1 cup soymilk

= 20

grams soy protein

2 tablespoons soynut butter with whole grain waffles and a sliced banana

grams soy protein

1 apple or celery sticks with 2 tablespoons soynut butter

grams soy protein

½ cup soft or silken tofu in a fruit smoothie

= 10

grams soy protein

Favorite soup with ½ cup canned soybeans added

= 13

grams soy protein

protein to your everyday meals. It is easy and delicious! From my kitchen to yours,

Linda Funk Executive Director The Soyfoods Council lfunk@thesoyfoodscouncil.com 800-383-1423

thesoyfoodscouncil.com | Follow us on Twitter and Facebook. 6 | F E B R U A R Y 2 0 1 4 | S O Y B E A N R E V I E W. C O M

IT’S ABSOLUTELY TRUE THAT OUR OWNERS RIDE TO WORK IN CABS. WE ARE OWNED BY THE FARMERS AND RANCHERS WE SERVE _ AND IT SHOWS. Every one of our owners is a customer — people who live and work in rural America. So along with offering financial products with attractive rates, we deliver agfriendly terms, money-saving services, management tools and cash-back dividends. Discover the difference. Call 800-884-FARM.

Todd Lewis Lewis Grain & Livestock Grain & Swine Producer Forest City, IA fcsamerica.com/toddlewis

Iowa High School Seniors can Apply for Iowa Soybean Association Scholarships ISA AWARDING TEN $1,500 SCHOLARSHIPS TO STUDENTS STUDYING AGRICULTURE

The Iowa Soybean Association (ISA) is offering ten $1,500 scholarships to high school seniors who plan to pursue agricultural studies in college. Scholarships will be awarded to one student in each of Iowa’s nine crop districts. From those recipients, one student will be selected to receive an additional $1,500. Applications are due by March 1 and winners will be announced April 15. “It truly is an honor to recognize students who will bring agriculture into the next phase, whether that is through research, technology or joining the family farm after college,” explains ISA President Brian Kemp who farms near Sibley. “As students see their education costs increase, we’re proud to

offer these scholarships to support students who want to pursue the opportunities in agriculture.” Many ISA Ag Scholarship Program recipients are working in a variety of ag-related careers ranging from sales to research to association work. Scholarship application forms are available at www.iasoybeans.com and include the following items: • An essay addressing “What role would you like to play in agriculture and/or the soybean industry in the five years following graduation?” • Three letters of recommendation. • Submit four copies of each document.

Additional details can be found at www.iasoybeans.com or by contacting Mary Whitcomb at 800-383-1423.

Linking Iowa soybean producers to global markets

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Photo by Marc Sterling

ISA Leaders Serve on United Soybean Board Work Groups Tom Oswald, Iowa Soybean Association (ISA) president-elect and Dean Coleman, ISA board member and past president, were recently appointed as Qualified State Soybean Board (QSSB) liaisons to United Soybean Board (USB) 2014 work groups. Oswald, who farms near Cleghorn, was appointed to the Freedom to Operate/ Communications work group. Dean Coleman, a Humboldt-area farmer, was appointed to the Oil/International Opportunities work group. “We have a large supply of soybean oil and I want to give input on how to increase oil use worldwide. We also need to provide our customers a product that has more value and gives us an edge in marketing,” Coleman says. “That is why this working group is so critical as oil has traditionally been the drag on soybean prices. Any demand we can create will add to our bottom line.” Under USB’s structure, each action team (Meal, Oil, Freedom to Operate and Customer Focus) is broken down into the four target areas: domestic opportunities, international opportunities, supply and communications. USB Chairman Jim Call says, “The work groups provide two essential roles in our new structure. They work across the target areas to provide input on trends and potential strategies for action team and oversee implementation of tactics related to that work group focus,” he says. “Most importantly, the work groups are where we see the greatest opportunity for collaboration among soy organizations, industry and QSSBs.”

Dean Coleman

Tom Oswald

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Investing Checkoff Dollars

Lessons Learned: Iowan Reflects on National Leadership Role By Aaron Putze

Jim Stillman of Emmetsburg completed his term as chairman of the United Soybean Board at the organization’s winter meeting held recently. Shortly after passing the gavel to 2014 Chairman Jim Call of Minnesota, Stillman reflected on experiences gleaned from his leadership role. ISR: What was the highlight of your role as chairman?

Jim: Working closely with many dedicated farmers and professionals from across the globe to advance the interests and priorities of U.S. soybean farmers. Every location we traveled – from feed mills in Poland to restaurants in Beijing – brought us in contact with people who were interested in our perspective and eager to learn more about how we farm in the United States. Every discussion yielded new perspectives that will continue to improve opportunities for U.S. soybean farmers.

ISR: What skills did you develop most during your chairmanship?

Jim: Interpersonal communications and familiarity with the issues. Also, the ability to expound on the issues and to look at them from a variety

of perspectives. I also valued the opportunity to work with the board on our new structure and the need to be strategic and focused. We considered projects that were bolder and innovative. There’s some tweaking to do yet, but we’ll keep working at it.

ISR: What assurances do you give farmers regarding the investment of their checkoff dollars?

Jim: The farmers who serve on the USB board are truly looking out for the yield and profitability of the farmer. They’re constantly reminded that resources are derived from yield. They also dedicate their time and energy to expanding markets for U.S. soybeans. We realize that growth markets are both domestic and international. That’s why we strongly support the growth of the U.S. livestock industry while

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also building relationships with other countries, realizing that we not only need plentiful food in the U.S. but have a responsibility to send what we can to customers around the world to help them improve their quality of life.

ISR: What’s the most important issue facing soybean farmers in 2014?

Jim: The continued delay in getting new traits approved to improve our profitability and to serve our customers. We’ve slowed down tremendously in the United States in the approval of traits. If we don’t get on the ball, we’re not going to continue to be the market leader, which means we might not be able to grow as fast as we should. We’ve hit a wall due to unnecessary hurdles and that doesn’t bode well for U.S. soybean farmers and our customers.

Investing Checkoff Dollars

5 Questions with

Robert Riley of Feed Energy 1. What is Feed Energy’s role in Iowa’s animal agriculture?

Feed Energy is the largest member within the Riley Resource Group, a collection of agricultural companies. We provide concentrated chloric energy to the feed rations of many Iowa animals. They need protein, carbohydrates and calories in order to live and thrive. We supply the calories portion. That energy comes from the oil of crushed soybeans, corn and animal fat. Of the 58 million laying hens in Iowa, our energy ingredient is fed to 30 million of them. That’s about 52 percent. We also provide “racing fuel” for most of the 14 million turkeys in Iowa. And many large hog and cattle producers utilize our product to maintain immune system health and increase daily gains. Our role in Iowa animal agriculture is fairly expansive and we take our responsibility seriously.

2. What is the future of soy in feed and food?

The utilization of soy as a feed ingredient will remain strong well into the future. Whether as a protein from meal or an energy source from oil, soy is a great crop. It’s a nitrogen-producing crop (as opposed to consuming nitrogen in the soil). It’s highly digestible, highly metabolizable and well-rounded, as an amino acid and fatty acid source. The demand for animal protein as a source of food for humans is expanding along with the increase in population. However, some proteins are under fire for various reasons, including perceptions tied to health, the environment and animal husbandry. Nevertheless, soy will always be seen as a preferred protein source.

3. What should farmers be doing now to become more competitive livestock producers?

Use more soy. Understand all of the aspects of the production chain, starting with air, water and soil and ending with health, wellness and

nutrition. The actions within each link affect the chain as a whole. When everyone shares a responsibility and a common goal for current and future generations, the competitiveness of the system is enhanced.

4. You use soybean soap stock in your products. What is it? How many soybeans do you use?

Soap stock is a derivative of the soy oil refining process. It contains certain components that are incredibly valuable to an animal production system. An estimated 137 million bushels of soybeans were used to make the products we made in 2013. This is 8 percent of the U.S. crush market.

5. You are passionate about water quality. Do you feel farmers will be successful at the Iowa Nutrient Reduction Strategy?

It is of great concern to many that the voluntary methods practiced by many farmers since the 1930s have not resulted in a meaningful reduction of soil loss or improvement in water quality. Modern farming techniques, without adequate compensatory conservation practices, will continue to degrade the quality of our soil and water. It is essential that the trade associations and their members make water and soil quality a top initiative in order to achieve substantial progress in the Nutrient Reduction Strategy. If not, government intervention is inevitable. The onus must be on the trade associations and their members to take responsibility for real results. The Iowa Soybean Association has led the way among the commodity groups. It must redouble its efforts and convince and join forces with the others to exceed and accelerate practices beyond the regulatory framework. This action and the results will allow the “farmer-hero” to re-emerge.

“Our role in Iowa animal agriculture is fairly expansive and we take our responsibility seriously.” -Robert G. Riley, CEO of Riley Resource Group

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Livestock Provides

Economic Lift to Iowa By Matthew Wilde

The construction and day-to-day operation of Matt and Janene Raasch’s 2,499-head hog barn near Odebolt is projected to have a nearly $1.9 million impact on the local economy in the first year, according to the Coalition to Support Iowa’s Farmers (CSIF). A financial windfall for Sac County, indeed. But wait, it gets better. The Raasches’ investment is part of an industry that benefits all Iowans, with a big ‘B.’ A recent economic analysis of animal agriculture by Agralytica, a food and agriculture consulting firm based in Alexandria, Va., shows livestock generated $22.6 billion in revenues and $3.6 billion in household income for the state in 2012. According to the Soybean Checkofffunded study, commissioned by the United Soybean Board to determine the economic benefits of poultry and livestock at state and national levels, the livestock sector was responsible for 96,700 jobs statewide two years ago. In addition, it yielded an estimated $1.05 billion in income taxes and $353 million in property taxes.

The impressive statistics prove just how important the livestock industry is to Iowa, says Dermot J. Hayes, professor of economics at Iowa State University’s Center for Agricultural and Rural Development. “Iowa’s economy is not solely based on agriculture, but it’s probably the most important basic industry we have,” Hayes says, especially in rural areas. “You can drive in some of the towns with a lot of livestock nearby and see a lot of prosperity, like Webster City. Main street stores are filled again because people are living there because they have jobs on nearby farms,” Hayes adds. “Iowa’s economy would not be as healthy without livestock.” Matt Raasch, 40, couldn’t agree more. Though he and his wife built the new finishing barn – it was filled for the first time in December – to ensure the long-term success of their farm and provide an opportunity for their four children to raise food for a living, he says the community benefits as well. The couple custom feeds hogs for The Maschhoffs, one of the largest

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family-owned pork production networks in North America. They also raise soybeans and corn in partnership with Matt’s parents, who also raise 15,000 head of hogs a year for the Illinoisbased company. Matt is the fifth generation on his father’s side and fourth generation on his mother’s side to raise livestock in Sac County. His uncle Curt Raasch, who passed away a couple years ago, was posthumously awarded the Iowa Soybean Association’s (ISA) Legacy of Leadership Award. “I built this barn to help my boys carry on that legacy. Dad built his barns in the mid-1990s for the same reason,” Matt says. “We get paid for raising pigs. That money goes back into the local community. We buy as much as we can locally.” The expansion of animal agriculture in Iowa during the past decade has spurred the state’s economy. According to the report, pork production grew by nearly 55 percent and egg output jumped by 43.5 percent. Beef, turkey and milk production

Investing Checkoff Dollars

“Livestock is bringing young families back to the farm and making local economies thrive.” -Brian Waddingham, Coalition to Support Iowa’s Farmers

has remained fairly steady or increased slightly. That led to gains of $4.7 billion in economic output, $791 million in household wages, 20,500 jobs and $224 million in tax revenue in Iowa from 2002-2012, the report says. Iowa’s agricultural and construction equipment manufacturers have more than 20,000 employees with sales exceeding $11.9 billion, according to the Iowa Economic Development Authority. The success of companies like John Deere, Kinze, Hagie, Vermeer and their employees rely, in part, on the livestock industry. “A lot of jobs in Iowa (depend on it),” Hayes says. “It’s economic viability.” CSIF was established in 2004 by farmers and agriculture groups to help Iowa farm families successfully raise livestock and grow their operations in a responsible manner. The coalition does this by helping farmers navigate the maze of state and federal regulations, providing a building site analysis, consulting on safeguarding the environment and enhancing neighbor relations. Brian Waddingham, CSIF’s executive director, believes the state has a bright future because of livestock. More than 50 percent of the people calling CSIF for help

are under the age of 30, he says. “Livestock is bringing young families back to the farm and helping local economies thrive,” Waddingham says. “It puts people back in the seats at church, it helps the grocery store on Main Street stay open and puts children back in the schools.” Since animal agriculture is and always will be the No. 1 customer of soybean growers, ISA leaders say it’s imperative to support the industry. The ISA is a founding member and annually contributes to CSIF. Livestock in Iowa consumed an estimated 3.9 million tons of soybean meal --- nearly 164 million bushels of soybeans --- in 2012, according to the report. Pork and egg production accounted for the vast majority of use at 81 percent and 8 percent, respectively. ISA President Brian Kemp of Sibley says investing checkoff dollars in livestock-related research and organizations is an easy decision. Analysts predict profits in grain production will become harder to come by in coming years, and studies show livestock adds value to grain. “We need each other,” Kemp says. “It will become even more important in the future.”

Matt Raasch, Farmer near Odebolt

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U.S. beef and pork exports posted another strong performance in 2013, with beef exports setting an all-time value record and total red meat exports expected to exceed $12 billion for the first time. While December results are not yet available, beef and beef variety meat exports had already reached $5.61 billion through November – breaking the 2012 record of $5.51 billion. Volume was 1.07 million metric tons (mt) – a 3 percent increase over last year but below the record pace of 2011. The year-end total for beef exports is expected to about 1.16 million metric tons, valued at $6 billion. Perhaps an even more telling statistic is the value of U.S. beef exports per fed steer or heifer slaughtered, which reached $267 in November and averaged $242 through the first 11 months of last year. That’s a 13 percent increase over the 2012 average and up nearly 20 percent from 2011.

“Export value per head of fed slaughter is an important measuring stick for producers,” says U.S. Meat Export Federation (USMEF) Economist Erin Borror. “Due to drought and other factors, maintaining the size of the U.S. cattle herd has been a challenge in recent years. Yet we are still managing to set records for beef export value, which is great news for the industry. During these times of tight supplies, many have suggested that exports will decline, but so far our international customers have been willing to pay higher prices for larger volumes of U.S. beef.” This growth has come at a time when the U.S. beef industry’s main competitor had more product on the market at cheaper prices. “Australia saw record-large beef export volumes in 2013, climbing 14 percent from the previous year to nearly 1.1 million metric tons,” Borror explains. “Yet much of this growth

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was due to a drought-driven increase in slaughter, as grazing conditions deteriorated throughout the year in key cattle-producing regions. A weaker currency also added fuel to Australia’s exports and they capitalized on markets where the U.S. does not have access, especially China. But U.S. beef still gained market share in Japan, the top destination for both U.S. and Australian beef.” The big growth drivers for U.S. beef exports in 2013 were Japan and Hong Kong, both of which expanded access for U.S. beef early in the year. Japan increased the eligible cattle age limit from 21 months to 30 months, greatly expanding the yearround supply of U.S. beef available for this market. Japan reclaimed its position as the No. 1 export market for U.S. beef, taking (through November) 219,081 mt valued at just under $1.3 billion. Hong Kong allowed bone-in U.S. beef cuts for the first time post-

Investing Checkoff Dollars

BSE, as well as variety meats and some cuts from cattle more than 30 months of age. Exports to Hong Kong more than doubled in volume (115,061 mt) over 2012 and increased nearly 150 percent in value ($727 million). After a slow start to 2013, U.S. beef exports also received a strong second-half boost from Mexico. Although U.S. pork exports did not set new records in 2013, exports continued to be an important catalyst for pork production and an important component for producer profitability.

Through November, pork and pork variety meat exports totaled 1.95 million metric tons (down 6 percent from the previous year) and valued at $5.51 million (down 5 percent). Total exports in 2013 likely reached about 2.1 million mt valued at just under $6 billion. Exports to Mexico approached $1.1 billion, up 6 percent from the record pace of 2012. Excellent growth was also posted in Central and South America, with Colombia emerging as the region’s top destination for U.S. pork. Strong growth was also achieved in Chile, Honduras and Panama. Lack of access to the Russian market – which closed to both U.S. pork and beef in February 2013 – was a significant setback for pork exports last year. U.S. pork also faced considerable adversity in leading market Japan, including a weaker yen, increased competition and more rigorous documentation requirements. Despite these obstacles, exports to Japan still reached 390,388 mt through November, valued at $1.73 billion and Japan’s imports of chilled U.S. pork increased 8 percent from a year ago. Pork export value per head

slaughtered was just under $54 for the first 11 months of 2013, down slightly from the previous year. Exports accounted for about 26 percent of total U.S. pork and pork variety meat production. From both the state and national levels, soybean producers provide critical financial support for USMEF’s efforts to promote U.S. beef and pork in international markets and to improve market access for U.S. red meat products. Over the next year, soybean industry support for USMEF is expected to be more than $2.9 million – about 8 percent of USMEF’s total revenue. “Soybean industry leaders understand the important role U.S. meat exports play in the viability and profitability of our livestock industry,” says John Hinners, USMEF assistant vice president for industry relations. “With animal agriculture being soybean producers’ largest customer, meat exports strengthen the domestic market for soybeans. It’s a partnership in which everyone wins, and we are extremely grateful to the soybean industry for its longtime dedication and support of USMEF.”

“With animal agriculture being soybean producers’ largest customer, meat exports strengthen the domestic market for soybeans.” -John Hinners, USMEF Assistant Vice President for Industry Relations F E B R U A R Y 2 0 1 4 | S OY B E A N R E V I E W. C O M | 1 5

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By Matthew Wilde

Raising bass in old hog confinement buildings might sound fishy, but two central Iowa farmers say aquaculture is a burgeoning business and could be a boon for the state’s soybean farmers. Mark and Jeff Nelson started Iowa’s First aquaculture facility near Webster City about two years ago. The cousins, who also raise soybeans and corn and contract feed finishers for Swine Graphics, say fish are lucrative livestock and there’s plenty of opportunity for growth in the state given the demand for seafood domestically and worldwide. According to the National Oceanic and Atmospheric Administration, 91 percent of the seafood consumed in the United States is imported. China, the world’s most populous country, is expected to become an importer of fish instead of an exporter. The Iowa Soybean Association

(ISA) and other soybean organizations have invested hundreds of thousands of soybean checkoff dollars through the years in aquaculture research and marketing. Soybean meal and soy products are the primary ingredients in fish rations. Checkoff-funded projects include finding more efficient ways to raise fish, which will bolster the demand for soy-based feed. Iowa’s First sells whole hybrid striped bass, which are being phased out, Barramundi sea bass and shrimp to processors, wholesalers and restaurants in the Midwest. Eateries in Des Moines are clients. Buyers started calling the Nelsons before they had fish to sell. Mark says demand remains strong from Chicago to Minneapolis. “A lot of people want our (seafood). We have people calling asking for more,” Mark says. “The

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future … is in aquaculture. If we are going to feed the world, aquaculture is the way to go.” Grant Kimberley, ISA director of market development, says that’s good news for soybean growers. Increased soybean demand ultimately leads to better prices, he adds. “Aquaculture is the biggest new soy meal demand opportunity here and abroad,” says Kimberley, noting 500 million bushels of U.S. soybeans are being used by the industry. “It’s already (a big market) and it could be bigger.”

A true fish story

Iowa’s First was born out of a quest to find a use for three empty hog farrowing buildings. After three years of research, the Nelsons decided to give aquaculture a try. “It looked like a pretty good return,” Jeff says.

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The family gutted the interior of the barns and initially installed a dozen 10,000-gallon rectangular tanks. Six more similar-sized finishing tanks were added last year along with 32 200-gallon nursery tanks. Another 10,000-gallon tank for shrimp became operational in October. The company’s second batch of 50,000 shrimp will be ready for market soon. Iowa’s First is the largest indoor fish farm in the state. The business is capable — though not quite there yet — of selling 22,000 fish a month. Opposing Flows Technology is used to recirculate water. Every gallon is filtered every 45 minutes, which helps fish thrive. There are many similarities between raising fish and hogs indoors, the Nelsons say. Automatic feeders are used, which drop soy-based pellets in tanks 10 times a day. Raising fish in climatecontrolled buildings is more efficient. It’s easier to maintain water temperature in the mid70s to low 80s to maximize growth potential and keep death loss to a minimum. Fish are sorted or graded several times as they grow to keep similar-sized fish together and alleviate crowding to improve performance. The Nelsons raise a fish to market weight --- 2 pounds, on average --- in 7 or 8 months compared to 2 years in outside pens. The Nelsons declined to provide start-up costs and profit margins. They say every situation is different, whether retrofitting an existing structure or building new, and potential operators need to do their own research and cost-benefit analysis.

“It’s profitable,” Mark says. “(And) Demand is not an issue.”

The future of aquaculture Agriculture experts believe aquaculture can be a good way to diversify farming operations in Iowa and feed the world. While popular in other countries like China and Ecuador, only a handful of fish farms exist in the state. That may soon change. “There’s growing interest in aquaculture, especially from guys with hog barns they don’t know what to do with,” says Brian Waddingham, executive director of the Coalition to Support Iowa’s Farmers. “I certainly see some growth potential.” As more farmers dive into aquaculture, the Nelsons say an Iowa fish cooperative would benefit all growers. An Iowa-brand of fish could be developed and feed could be purchased in larger quantities, possibly from a local feed mill, to cut expenses. A co-op would help maximize income potential, officials say. Judging by the steady stream of phone calls the Nelsons and Waddingham receive from farmers interested in the business, the industry could be on the verge of taking off. “I think people are looking at the economics of aquaculture,” Mark says. “Jeff and I have a lot of knowledge to share.” Aquaculture questions can also be directed to Allen Pattillo, Iowa State University’s aquaculture and fisheries extension specialist. He can reach at pattillo@iastate.edu or by calling (515) 294-8616.

Mark Nelson, Iowa’s First

“The future... is in aquaculture. If we are going to feed the world, aquaculture is the way to go.” -Mark Nelson, Iowa’s First F E B R U A R Y 2 0 1 4 | S OY B E A N R E V I E W. C O M | 1 7

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Chickens and Turkeys:

The Feathered Friends of Soybean Farmers By Matthew Wilde

Iowa’s layer inventory has increased more than 9 percent a year since 1990 and the turkey population jumped by 20 percent in the last five years, according to an Iowa State University (ISU) study and industry statistics. That means more feed, jobs and an economic impact totaling hundreds of millions of dollars. “The livestock industry is our largest customer and poultry is an important part,” says Iowa Soybean Association (ISA) Treasurer Rolland Schnell, who farms near Newton. “There are a lot of soybeans that go into producing eggs and turkeys.” Chickens and turkeys will eventually gobble up about 5 percent of this year’s state soybean harvest estimated at more than 415 million bushels. Iowa is home to more than 52.5 million laying hens, according to the November U.S. Department of

Agriculture Chickens & Eggs Report. Egg production totaled nearly 1.25 billion in October, data shows, which is tops in the country. A distinction the state has held since 2001. The ISU study, “Economic Importance of the Iowa Egg Industry,” released last January says layers and pullets consumed nearly 491,000 tons of soybean meal in 2011. That equals about 20.6 million bushels of soybeans. Corn consumption was pegged at about 50 million bushels. Twenty-two percent of a layer’s ration is soybean meal. In addition, the ISU report says the egg industry is an important value-added activity in Iowa directly employing an estimated 3,700 workers and generating more than $156 million in direct payroll. The multiplier impacts on the Iowa economy are even more impressive,

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with total labor income of $424 million, nearly 8,000 jobs and an economic boost of $657 million. “I think those numbers speak for themselves in what the industry provides the state,” says Andrew Kaldenberg, president of the Iowa Poultry Association and complex manager for Rose Acre Farms in Stuart. Rose Acre has 17 egg production facilities in six states. Its other Iowa laying operations are in Guthrie Center and Winterset, which are also home to company-owned feed mills. Rose Acre has 4 million birds in the state. Kaldenberg says there’s no better place to produce eggs given the proximity to feed, the No. 1 expense in poultry production. Noel Thompson, an Ellsworth farmer and president of the Iowa Turkey Federation (ITF), says the same goes for raising turkeys. More than 10 million

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gobblers were grown in Iowa last year compared to 8 million birds six years ago, according to ITF officials. Thompson raises about 750,000 turkeys a year with his brother-in-law Paul Hill. “You grow poultry where you have the feed stuffs. It doesn’t make sense to do it elsewhere,” Thompson says. “We will continue to see livestock grow. That means one thing: A strong, local market for (grain).” That’s good news, Schnell says. Last fall the nation’s farmers harvested the thirdlargest soybean crop and the largest corn crop on record. Schnell, chair of the ISA’s demand committee, says it’s important to find a home for all that grain. If more Iowa soybeans are fed to homegrown turkeys and chickens, all the better, he says. “It’s an at-home use that makes the grain even more valuable,” Schnell adds. “Turkey and eggs are a valueadded product. That money turns over in the state.” Every turkey consumes onethird of a bushel of soybeans during its life. Iowa’s 130 turkey farms feed an estimated 350,000 to 400,000 bushels of soybeans. Twenty-five percent of a turkey’s feed ration is soybean meal. About 83.5 million bushels of soybeans were fed by U.S. turkey growers last year. Production was pegged at 253.5 million birds, according to the National Turkey Federation

(NTF). Numbers have steadily increased nationwide since 2010. Iowa ranks ninth in turkey production nationwide, far behind first-place Minnesota at 46 million head. The vast majority of Iowa turkeys are processed into sandwich and deli meat and other products. “A lot goes to Jimmy John’s, Subway and Jimmy Dean turkey products,” says Gretta Irwin, executive director of the ITF. “I think we quietly go about our business. (But) turkey is an important part of local economies when it comes to feed, labor, utilities, etc.” According to the ITF, each turkey raised contributes more than $24 to Iowa’s economy. The economic impact of raising and processing turkeys in Iowa is more than $2 billion. Iowa ranks fifth in the nation in turkey processing, Irwin says. The NTF ranks Iowa processors Hillshire Brands Co. and West Liberty Foods at fifth and 11th, respectively, nationwide. Butterball, LLC is the top turkey processor in the country. Thompson says the state’s poultry and grain farmers complement each other. Robert Witt of Macksburg, an ISA District Advisory Council member, understands this better than anybody. Not only does he farm, but he works at the Rose Acre feed mill in Winterset. Witt says the mill provides another competitive market for grain, which he and other farmers appreciate. “It’s another market to utilize close to home,” he says.

Andrew Kaldenberg of Rose Acre Farms (Center) shows Kristin Porter, better known as Iowa Girl Eats, a healthy hen while Kevin Vinchattle, Executive Director of the Iowa Egg Council looks on.

“There are a lot of soybeans that go into producing eggs and turkeys.” - Rolland Schnell, Iowa Soybean Association Treasurer

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Growing a Crop,

Reaching Her Customers By Heather Lilienthal

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aura Foell is an Iowa farmer who knows her crop and her customers. As a soybean grower, Foell knows her crop from the time the seeds meet the soil to the moment harvest ends. As secretary of the U.S. Soybean Export Council (USSEC), she meets with customers around the world to learn more about their needs and promote the quality and dependability of U.S. soybeans. “Livestock is our No. 1 customer, both domestically and internationally,” says Foell from her kitchen in Schaller. It was a uniquely quiet time for Foell, catching her between attending meetings for USSEC, the United Soybean Board and the Iowa Soybean Association (ISA). “It’s important for Midwest farmers who grow soybeans to have a firm understanding of the needs of their customers, whether that is a hog farmer in China or a soybean crusher in Taiwan.”

International interaction

USSEC hosted its annual U.S. Soy Outlook Conferences in early December, visiting Taiwan, Japan, China and Korea. USSEC’s goals for conference participants were to help them gain access to critical information about U.S. soy and explore business opportunities. The conferences also offered attendees opportunities to interact with grower leaders. According to Paul Burke, USSEC director of the North Asia Region, the market is extremely important to the mission of the U.S. soy family. “Seventy percent of U.S. soybean exports go to this region, which is also sometimes the No. 1 market for U.S. soybean oil,” says Burke. “It’s a growing market with a very good market share, and we have a long-term history there with our very loyal buyers, especially in Japan, Taiwan and Korea.” Grant Kimberley, ISA director of market development, says U.S. soybean exports continue to follow a near-record pace moving into 2014. “I don’t see many changes in the demand trend,” he says. Foell traveled to USSEC’s Taiwan conference. There, she met with one of the largest soybean crushers in the area, representing 52 percent of the country’s crush business. In 2012, Taiwan was the seventh-largest market for U.S. agricultural products, the sixth-largest market for U.S. soy, and one of the world’s largest consumers of U.S. agricultural products on a per capita basis. Taiwan has consistently imported over $3.5

billion of U.S. farm products annually. Foell offered a 2013 production year summary, discussed the outlook of future planting and spoke about sustainability and international certification. The USSEC group also talked about U.S. soybean quality, a projection of 2014 global oilseed supply and demand and U.S. containerized soybean supplies. “Taiwan’s U.S. soybean supply comes in containers from Illinois, which travels by rail to Long Beach, CA, and is then shipped overseas,” says Foell. “Our customers in Taiwan are pleased with the protein and oil content, which are their key concerns.” Foell says the meetings are important as they allow U.S. farmers and suppliers to meet with their Asian partners and strengthen relationships. “They want to know about the decisions I make on my farm,” says Foell, eyeing the fields surrounding her home in northwest Iowa. “We discuss the cost of production, the issue of sustainability and more. These customers want a dependable supply of high-quality soybeans. We can meet those needs and USSEC works to connect those dots.”

Strengthening by demand

According to Kimberley, as the Asian region’s middle class continues to strengthen, the area’s agricultural industry will, as well, including the production of hogs, poultry and aquaculture. “That growing middle class will demand more meat in their diets and the need for more livestock production will grow, too,” says Kimberley. That demand may lead to increased imports of U.S. meat. Foell says that is still a good opportunity for U.S. soybean farmers. “Right now, we use less than half of our soybean supply here at home. If we grow the soybeans, have it fed to U.S. pork and poultry growers and increase those meat exports, that’s adding value here,” she says. “Farmers need to understand they are truly feeding the world; that our products go all over the world,” adds Foell. “We have to continue to work to be a part of the chain, whether that is securing market access, emphasizing quality control at the farm level and discovering new opportunities for our commodity. Soybeans are a part of all agriculture, from feeding livestock to human use. Farmers need to be a part of these discussions and support their products.”

“Farmers need to understand that they are truly feeding the world; that our products go all over the world.

”

-Laura Foell, U.S. Soybean Export Council Secretary, Schaller

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Farmers Use Data

To Turn Manure Into Profits By Mick Lane

Manure may well have been the first form of fertilizer used by farmers, and Iowa’s livestock and poultry generate plenty of it. Wendell Davison of Garner believes it’s still one of the most economical and likely the best fertilizer available, when used properly. Davison and son, Drew, raise hogs and row crops near Garner. They’ve conducted replicated strip trials and worked at adaptive management through the ISA On-Farm Network® for several years to help get the most benefit from the manure from their hog operation. “We don’t have enough manure to cover all of our crop land,” Davison says. “Our approach is to use the manure on as many acres as we can. There are more benefits from manure application than just the nitrogen it contains. And we know that some of the nitrogen that we can measure in the manure is not available to the crop during the year after it was applied. “In total, we’re applying the amount

of N for corn that the experts say is adequate, without going over the amount of N we’re allowed to apply based on our manure management plan,” he continues. “We do that by applying manure in the fall. We use UAN as a carrier for preplant herbicides in the spring. And then we sidedress an additional 50 pounds or so of nitrogen after the corn is up, late May or early June.” Davison says their manure management plan, which is based on a 195 bu./acre corn yield goal, allows them to apply as much as 4,220 gallons (200-220 lbs. of N /acre) of liquid hog manure per acre. “We never apply that much,” he says. “Instead, we’re applying 3,000-3,200 gallons per acre to spread the manure over as many acres as we can. “Through the tests we’ve done with the On-Farm Network, we see a consistent economic yield bump when we sidedress with 50 pounds of UAN, even when we use higher manure rates. And we’ve found when we back off with the manure rates

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and follow up with spring nitrogen, yields tend to stay about the same as when we use higher manure rates with our spring Nitrogen (N) program,” he notes. Davison says another reason for sidedressing is where they’ve used manure without extra commercial N on fields with no recent history of manure application, they often see nitrogen deficient streaks in the field. “As good as the liquid manure application equipment is today, we’re still seeing deficient areas in the field. Sidedressing additional N tends to make those areas disappear,” he says. Davison also relies on corn stalk nitrate testing to confirm whether N rates resulted in sufficient N in the field. He says the liquid hog manure provides a good base level of N to get the crop started. “By my calculation, we applied about 145 pounds of N in the manure that went on this past fall,” he says. “That leaves me about 90 pounds to split between the herbicide carrier and sidedress application this spring for corn after corn.

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“Where we plant corn on beans, we recalculate our manure and N applications based on a total of 50 pounds less N than on corn-on-corn,” Davison says. “The whole idea is to use the manure on as many acres as possible in order to get the most benefit from it.” Besides farming, Abe Sandquist of Woodbine also operates Natural Fertilizer Services, Inc. a company he started initially to facilitate the application of cattle manure from feeding operations in western Iowa on crop land. While he works with some farmer-feeders, most of the row crop producers he works with are not directly affiliated with cattle feeding operations. “I currently work with cattlemen and row crop producers all the way from Clarinda to up in the LeMars area,” he says. “My clients see manure as a crop production input rather than a waste product,” he says. “We do extensive testing of the manure before we apply it. It varies in content, based on the type of cattle, type of ration being fed, the amount and type of bedding materials used, and a number of other factors. By testing for nutrient content we can estimate the minimum amount of N, P, K and micronutrients it can supply. Then we can use the manure as the main fertilizer and supplement it with commercial fertilizer sources if needed.” In addition to testing manure, Sandquist also looks for results, in the form of crop yields. “Not all the nutrients in manure are available to the crop in the year it’s applied,” he says. “In addition to testing the manure, we use soil testing on farmers’ fields, to target the manure to the fields it will benefit the most.” He’s worked closely with the OnFarm Network since 2008, conducting two treatment replicated strip trials and expanded (several N treatments) manure trials, seeking the right mix of feedlot manure and commercial fertilizer to provide a complete mix of crop nutrients. “While the macronutrients (N, P, and K) are needed in the greatest amounts by the crop, manure also contains organic matter and micronutrients, which are hard to buy

commercially, and spread uniformly as part of a commercial fertilizer mix.” Based on On-Farm Network studies Sandquist has done, he says it’s difficult to predict how much of the nutrients in manure, and how much of the nitrogen in particular, might be available during the growing season. Because livestock rations can vary greatly, it’s important for farmers to test the manure they use and conduct soil tests often. Sandquist says On-Farm Network testing has shown him that, in some cases, more N was available from the manure than he anticipated, but that in other cases, available N was well below expectations. “Our manure application equipment was designed just for our use. It processes the solid manure into small-sized particles that are spread in a 60-foot swath. The wider swath helps minimize wheel tracks and soil compaction, but application across the swath is so uniform that we can use precision application programs based on soil tests to meet the nutrient needs in different areas of the field,” he says. “Often, this lets farmers meet the P, K and micronutrient needs of the crop, allowing them to use manure on more acres, supplementing with commercial N.” He says farmers using liquid hog manure can often meet the N needs of the crop with manure, but may need to add supplemental P and K. “By testing soils and the manure products, and including On-Farm Network replicated strip trials and stalk nitrate tests, we can learn to use the manure more effectively and efficiently than we may have in the past,” he says. Dr. Peter Kyveryga, On-Farm Network operations manager – analytics, sums it up like this: “Wendell’s and Abe’s experiences suggest the importance of combining data from different on-farm studies to produce crops more economically by improved manure management. It also lets them identify management, weather and soil factors where different manure sources can increase yields, and improve soil quality with minimal economic and environmental losses.”

“My clients see manure as a crop production input rather than a waste product.” -Abe Sandquist, Natural Fertilizer Services, Inc., Woodbine

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Going It Alone Is Overrated

}

Rita Cook CSIF Assistant Field Specialist

Traye Hindman Beau Hindman

Working beside you... from start to finish

As young people look to start farming, they need to consider all of their options. Raising livestock today can be a viable option to start farming, or to bring another generation back to the family farm. The Coalition to Support Iowa’s Farmers (CSIF) can help, as Beau and Traye Hindman, third-generation farmers from Radcliffe, learned. “We turned to the Coalition to help get our start in farming ,” says Beau. “After attending the Farming for the Future conference, we realized that the Coalition could help us grow our farm responsibly in many ways,” adds Traye. “From siting our new hog barn to helping interpret rules and regulations, the CSIF team has been a huge help saving us time and money.” To find out how CSIF can help you at no cost, call 1-800-932-2436 or visit our website, www.supportfarmers.com.

Scan this code to hear more from the Hindmans.

Your farm. Your familY. our focus.

CSIF is a not-for-profit, non-lobbying organization funded by the Iowa Cattlemen’s Association, Iowa Corn Growers Association, Iowa Farm Bureau Federation, Iowa Pork Producers Association, Iowa Soybean Association, Iowa Turkey Federation and Midwest Dairy Association.

800-932-2436 • www.supportfarmers.com Partially funded by the soybean checkoff.