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Soy
Food Aid Initiative Could Boost Prices to Farmers and September 26, 2000… Saint Louis, Missouri… The American Soybean Association (ASA)
and the National Oilseed Processors Association (NOPA) have jointly presented to
Agriculture Secretary Dan Glickman a comprehensive soy food aid program that could boost
soybean prices by 47 cents per bushel and therefore reduce U.S. farm program outlays. The
net result would be a $427 million savings for U.S. taxpayers. The food aid initiative
could be implemented immediately by the Administration and requires no new authorization
or funding from Congress.
“We believe the opportunity exists to significantly increase the amount of soy
programmed under various food aid programs,” said ASA President Tony Anderson, a
producer from Mount Sterling, Ohio. “A record amount of food aid was programmed by
USDA last year, and USDA is to be commended for providing this aid. “However, a lot more soy could
be included in future shipments. Governments around the world and U.S. Private Voluntary
Organizations (PVOs) are asking for more soy. This food aid will help feed millions of
hungry people abroad and help improve farm prices by removing surplus soybeans.”
The loan rate for soybeans grown this year is $5.26 per bushel with a projected
crop size of 2.90 billion bushels. USDA currently estimates that it will disburse
approximately $2.4 billion in soybean loan deficiency payments and soybean marketing loan
gain payments since prices are well below the loan rate. The total cost for utilizing the
recommended 3.1 million metric tons (170 million bushels equivalent) of surplus soybeans,
soybean meal, and soybean oil for food aid is slightly more than $873 million including
freight. (See the food aid summary tables available at www.amsoy.org/foodaid/ for more information.) At
this level of utilization, USDA would support an increased market price for soybeans that
would lower soybean loan program payments by $1.3 billion. Subtracting the cost of the soy
products and freight from the soybean loan program savings, ASA estimates that its soy
food aid program would result in a net benefit not only for farmers and hungry families
around the world, but also would result in a net savings of $427 million for U.S.
taxpayers. ASA’s estimates are based on
elasticity models developed by the Food and Agricultural Research Institute (FAPRI) that
is operated by Iowa State University and the University of Missouri-Columbia, and
USDA’s own estimates of projected LDP and marketing loan gain payments to producers. “In addition to supporting
soybean prices and helping feed hungry and malnourished people, donating soybeans and
soybean products will strengthen political and economic stability in recipient
countries,” Anderson said. “This initiative can also help develop new long-term
markets for soybeans and soy products, including high-value soy protein products.”
ASA developed the comprehensive soy food aid list in cooperation with NOPA to
ensure that the food aid assistance will not negatively impact U.S. commercial exports or
agricultural industries in countries that receive assistance. “We are urging USDA to announce
a major soy food aid initiative under which soybeans and soybean products will be
purchased and donated under various concessional sale and donation programs including
Section 416 (b), Food for Progress, P.L. 480, the International School Lunch Initiative,
and HIV/AIDS programs,” Anderson said. “Food aid is the most significant market
available for moving surplus soybeans and soy products.” --30-- For more information contact: Tony Anderson, ASA President, (740) 437-7803, db8566b@dragonbbs.com Also see the Soy Food Aid Program
Index, which includes links to the |