Moving Forward

Moving Forward

Kirk Leeds, Chief Executive Officer, Iowa Soybean Association

After nearly 30 years working for Iowa’s soybean farmers, I have had a front-row seat to a lot of changes in agriculture.

I have seen our industry grow, watched soybean prices rise and fall, survived years of drought and flooding, witnessed new technologies emerge, watched as consumers became more engaged in how food is produced, observed multiple Farm Bills get passed and implemented, seen trade agreements negotiated and broken, and traveled to China countless times as they became the largest consumer of soybeans in the world.

Even with all this history, I can honestly say I've never seen anything quite like what we have experienced in the last 12 months. From last fall’s harvest challenges to this spring’s never-ending rainfall, this has been a period that we will be talking about for years. Beyond the weather challenges, we have been whipsawed by disruptions and potential disruptions to exports to China, Mexico, Canada and a host of other markets. Just when we think things might be getting better, something always seems to happen to cause another downward spiral.

Through all of this, the Iowa Soybean Association has continued to take a long-term view of these challenges and to do our best to keep moving forward to find new markets for Iowa’s soybeans. We also continue to work alongside farmers as they seek to reduce costs in a time of limited profits. These are tough times, but as always, farmers remain focused on the future.

I think that one of the most tangible (and hopefully most likely) positive developments on the horizon would be the approval of the U.S. – Mexico – Canada Agreement (USMCA). This revised NAFTA agreement would allow U.S. agriculture to continue to see significant trade growth in two of our most important markets.

Since the enactment of NAFTA, U.S. soybean exports have quadrupled to Mexico and doubled to Canada. Mexico is the number two buyer of U.S. soybean meal, soy oil and whole soybeans. Canada is the number-four buyer of U.S. soybean meal and ranks 7th in soybean oil. Overall, Canada and Mexico account for 29 percent of all U.S. ag exports with Canada being the largest overall market.

USMCA, as drafted, has relatively little direct impact on soybean exports to either country as it would maintain the zero tariffs in place for soybeans and soy products. But it would ensure that we continue to have access to both markets and make improvements to biotechnology enforcement chapters, improve transparency and create a rapid response mechanism to address trade challenges as they arise. It also has several components that would be beneficial to our livestock and dairy producers.

I encourage you to take the time to make sure that Iowa’s entire congressional delegation understands the importance of the new agreement as Iowa’s farmers continue to work on moving forward. We will indeed see better days in the future but having trade disruptions resolved is critically important.

kleeds@iasoybeans.com, Twitter @kirkleeds