Marketing soybeans in 2008 has been an exhilarating and often scary rollercoaster ride with futures prices ranging from $15 in July to below $8 in December. But don’t hold your breath waiting for these commodity price declined to be reflected anytime soon in restaurants and supermarkets while the grocery manufacturers try to keep a straight face as they defend their position that biofuels are responsible for pushing up consumer prices. While most farming input costs continue to escalate, fuel prices have been trending down in recent weeks. The key question is what lies ahead for the U.S. economy in general, and also, whether the banking industry and the U.S. government can work out a plan that provides the financing needed by farmers, processors and soy customers to stimulate employment, investment and profitability. ASA has been doing its part to contribute to the success of U.S. soybean producers, and below are some of the major developments since our July Board meeting.–Stephen Censky, December 2008

ASA Achieves Biodiesel Tax Credit Extension   On October 3, ASA celebrated final passage of legislation that included an extension of the biodiesel tax incentive for one year through Dec. 31, 2009, and provisions to shut down the abusive "splash and dash" practice that currently allows foreign-produced fuel to enter the U.S., claim the biodiesel tax incentive and be shipped to a third country for end use.  The Senate added the tax extenders bill, including the one year extension of the biodiesel tax credit, to the financial rescue package (H.R. 1424, the Emergency Economic Stabilization Act), which the Senate passed on Oct. 1, by a vote of 74-25. When the House took up the bill it passed the measure by a vote of 263-171. Enactment of the biodiesel tax credit extension represents a significant legislative achievement on a key ASA priority because the growth in biodiesel sales has raised soybean prices by a conservative estimate of at least $2.00 per bushel.

ASA Work Helps Achieve Import Approvals for New Biotech Soybeans   Two new biotech-enhanced soybean varieties are on track for commercialization in 2009. In September, LibertyLink® soybeans from Bayer CropScience received final approval from the European Commission for importation into the European Union, and in December Monsanto’s Roundup Ready2Yield soybean final approval for food and feed use.  These approvals provide U.S. soybean producers with continued market access to nearly half a billion consumers living in the 27 EU member states.   ASA carried out extensive biotech advocacy work in Europe with EU officials, the feed industry, and the livestock industry to achieve these regulatory approvals.

ASA Plays Key Role in Protecting U.S. Soy Exports to Europe    ASA is being credited with playing a key role in defeating a ban in Poland that was to prohibit import, production and use of animal feed derived from biotech crops by August 12, 2008. Avoiding this ban prevented the disruption of U.S. soybean exports to the European Union generally, and exports of U.S. manufactured feed to Poland, worth $100 million annually. The GM feed ban was defeated by a coalition of the Polish Feed Millers, Poultry Association, and Pork Association, and U.S. trade associations, led by the American Soybean Association. During the 53 years that ASA has been partnering with USDA to implement international marketing programs, the American Soybean Association has built worldwide recognition and an excellent reputation for helping customers benefit from the quality and safety of U.S. soybeans and soybean products.

ASA Credits Policy and International Market Development Work for Driving Record U.S. Soybean Exports   ASA’s many years of farm and trade policy work, and its long history of building export markets, are largely responsible for the record level of U.S. soybean exports reported by the USDA’s Foreign Agricultural Service. In its year end report, USDA/FAS announced soybean exports exceeding 30.449 million metric tons, equivalent to 1.118 billion bushels, for Marketing Year 2007/08, which ended August 31, 2008. China was again the largest buyer of U.S. soybeans at 490.6 mil. bu. The European Union-27 was second with 143.1 mil bu.; Mexico was third with 131.3 mil. bu.; and Japan was fourth with 99.5 mil. bu. Collectively, these four buyers represented 77 percent of total U.S. soybean exports during MY 2007/08. As the policy advocate for U.S. soybean producers, the ASA advanced soybean production and exports through market driven Farm Bill legislation, trade agreements that brought down trade barriers, and new biotech soybean seed introductions that did not disrupt soybean exports. China’s accession to the World Trade Organization (WTO) was essential to improved market access for U.S. soybeans. Today, China’s soybean imports are more than 10 times greater than the quota that ASA blocked. ASA’s work with seed companies and foreign regulators to ensure that new biotech soybean varieties were brought onto the market without disrupting export markets was a major contributing factor behind this year’s record exports. The EU purchased eight percent more U.S. soybeans this year compared to last year. Under NAFTA, U.S. soybean exports to Mexico have doubled because ASA’s work brought down tariffs on U.S. soybeans and soy products. Worldwide demand for food, feed and fuel is supporting higher prices paid to U.S. farmers for their soybeans. ASA is optimistic about the future of U.S. soybean production and well-positioned to meet the challenges ahead.

ASA Supports U.S. Rejection of Flawed WTO Pact   ASA worked with U.S. negotiators in Geneva who rejected proposals in the Doha trade negotiations that did not provide sufficient market access for U.S. producers. The latest proposal would have sharply reduced U.S. domestic support programs, while allowing developing countries to increase tariffs on key agricultural products above their current levels. ASA is proud of the negotiating team, led by U.S. Trade Representative Ambassador Susan Schwab, in walking away from a bad deal in Geneva. ASA continues to support the WTO framework as the most effective means for expanding world trade, including access to foreign markets for U.S. soybean and livestock product exports, but believes that any WTO agreement must result in meaningful export gains.