Sep 26

Consumers of Iowa soybeans are indeed ‘real pigs,’ analysis finds

Iowa hogs

Iowa hogs

DES MOINES – When it comes to providing a market for Iowa-grown soybeans, the primary customers are indeed “real pigs,” the Iowa Soybean Association says.

An analysis of how Iowa’s soybean production is utilized, reported to directors of the Iowa Soybean Association (ISA) today in Ankeny, finds that nearly one of every four rows is fed to the more than 38 million pigs raised annually in Iowa. This equates to roughly 116 million bushels of the state’s soybean crop.

Put another way, every pig raised in Iowa consumes three bushels of soybeans.

The utilization study, conducted by Mark Imerman of Regional Strategic, Ltd., is based on a five-year rolling average of 462 million bushels of soybeans produced annually in Iowa.

As the leading producer of soybeans nationally, Iowa accounts for 14 percent of total U.S. output and 4.6 percent of global production. What’s unique and critically important about these statistics, Imerman said, is that Iowa is also a significant consumer of this production due to its prominence in raising livestock and poultry.

Local livestock and industrial production magnifies the intensity of the Iowa soybean production industry, Imerman said.

“If you think of soybean production as an industry foundation, processing 82 percent of soybeans in-state generates a solid second level to the industry. Feeding 38 percent of that processed meal to Iowa livestock adds a third level. And livestock packing and further processing adds levels four and five.

“Assuming that between 30-50 percent of the production machinery is built in Iowa, there’s a subfloor below the whole structure — generating level six,” he added. “Soybean production integrates a substantial portion of six industrial sectors in Iowa. That adds intensity to the industry’s size.”

The state’s role in growing feed for livestock, said ISA President Wayne Fredericks of Osage, is one reason why the association backed Prestage Foods’ recent efforts to locate a new pork processing facility in Iowa. The Wright County Board of Supervisors last month approved the new business to be located near Eagle Grove that will employ nearly 1,000 people once operational.

“Producing soybeans and livestock go hand in hand,” Fredericks said. “Synergies between the two will continue to positively impact the competitiveness of all farmers and give a boost to our rural communities.”

Additional findings from the analysis include:
• Nearly 82 percent of Iowa’s soybean crop — or 376.7 million bushels — is processed (or crushed) into meal (8.98 million tons) and oil (4.3 billion pounds). Another 15 percent is transported to other locations, both domestic and international. Roughly 3 percent is allocated to on-farm usage and inventory changes.
• Pig production in Iowa creates a market for 2.7 million tons of soybean meal per year, or 31 percent of all soybeans processed. Poultry — including laying hens, broilers and turkeys – accounts for 576,000 tons per year, or 6.4 percent. Domestic shipments of soybean meal total 3 million tons per year (34 percent) while 2.5 million tons (28 percent) is destined for international markets.
• Roughly 36 percent of Iowa’s soybean crop — a combination of whole soybeans, meal and oil – is exported annually.
• China remains by far the largest importer of soybeans grown in Iowa. Of all soybeans exported, nearly 75 percent are destined for the country of nearly 1.37 billion people. Japan and Mexico place a distant second and third at 3.8 and 2.9 percent respectively.
• More than 858 million pounds of soybean oil (75 million bushels) is used annually for biodiesel production. The great majority of soybean oil (roughly 3 of every 4 pounds) is distributed to other domestic production sources.

Soybean production information used in the analysis was allocated to export, processing, and final processed product utilization by blending data from more than a dozen sources including Informa Economics, Iowa State University Department of Economics, National Pork Producers Council, U.S. Department of Agriculture (USDA) and Foreign Agricultural Service. The full report can be accessed at iasoybeans.com by clicking on “About ISA,” then “Soybean Facts.”

The USDA estimates Iowa soybean production this year to total 550 million bushels, averaging 57 bushels per acre. That’s roughly unchanged from a year ago. Nationally, soybean production is estimated at slightly more than 4 billion bushels, an increase from 3.93 billion last year. Per-acre yields are pegged at 48.9 bushels per acre.

The Iowa Soybean Association (www.iasoybeans.com) develops policies and programs that help Iowa’s more than 36,000 soybean farmers expand profit opportunities while promoting environmentally sensitive production using the soybean checkoff and other resources. The association was founded in 1964 and is governed by an elected volunteer board of 21 farmers. It strives to be honest and transparent, fact-based and data driven and committed to environmental stewardship, collaborations and partnerships.

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