Soybean in Southern Saskatchewan
November 25th, 2014
An Opinion Editorial by John K Augerhandle MD
Brought to you by Jennett Marketing & Agronomy Services
“Soybeans rape the earth.
They rape your next crop – they are a cereal rapist.
Canola removes the least from the soil of all crops we grow verse what is factored into its costs of production.
Soybean is the exact opposite.”
I only write a piece once the questions begin with ‘Why?’
Who? When? Where? What? The answers to those are just facts – forgotten over time or mistaken at source. Either way, in those questions, the answers are but words. Now the Why – in the why the answers are power.
Farmers call on me daily. They are familiar with my work. They know that I know; so they ask. Their questions on Soybean came in a rush just over two years ago, starting with ‘Should I grow Soybean?’ peaking at “When or Where Should I?’ then crashing back to, ‘Why did I grow Soybean?’ and continuing with ‘Why the big Soybean push in Southern Saskatchewan?’
Question should start with Why, but the Answers usually end in Who. So I have questions for them: ‘Who benefits from your growing Soybean – is it you?’ Answer that, and you’ll know if you should be.
This is all preamble. Metering. The Soybean story in Southern Saskatchewan – like everything else – starts and ends in the dirt.
The Soybean push in Saskatchewan started almost overnight. One day, Beans were years from being acclimated for Southern Saskatchewan and the next it was “all about the Beans, about the Bean, no Lentil”. Grower meetings on Soybean husbandry were a weekly occurrence, more common than the cold. It was the next big thing – years premature. Why was that?
There is absolutely no doubt, Soybean are in the future of Southern Saskatchewan and the Prairies in general. The market will demand a larger Oilseed position in the rotation. South America and the U.S. can not increase output at the rate Asian demand is growing. Freight through Prince Rupert grants a competitive advantage. But this need isn’t there yet, and neither are the genetics. The need and the genetics look set to marry 4-5 years out, but not now. Faba have the more legitimate reason for a push. Soybean aren’t Hemp or Poppy where early adopters have a barriers to entry advantage. So why the premature push?
Potential Reason #1 – The obvious attraction for Soybeans had to be as a cheaper alternative to growing Canola in the South. There are a number of late Canola adopters who still are either gun-shy to try it or still in the learning stage and just not getting the results. Nothing has proven the south can grow Canola like the last 8 years of growing Canola has, with big, big yields commonplace since 2008. There are still unbelievers and they surely would be potential adopters.
Potential Reason #2 – A more subtle and specific attraction to Soybean may be the chance to avoid Aphanomyces soiled dirt. With Pea and Lentil hammered so hard in the rotation, they are now in fact ‘out’ of the rotation, And mean old Chickpea is just too unpleasant and frightening for many. That leaves Soybean as a rotation alternative and worth pimping them on these particular acres. Soybean – an answer for your future – since you must answer for your past.
Potential Reason #3 – There has been nothing attractive about Lentil prices since 2010. If you mistook the 2014 market for the 2011-2013 one then here too would have been a reason to embrace Soybean. You were wrong of course, but the reason was there for the misguided.
Potential Reason #4 – something else.
Reason #2 is actually the only legitimate reason to be looking at Soybean. Anyone who mismanaged their rotation needs to now embrace Canola as a third class in their rotation and either Soybean or Chickpea as their new pulse. But the Soybean push is not just on the Root Rot dirt as those acres are not legion – restricted just to mismanaged or drainage specific fields – the push is much bigger.
Reason’s 1 & 3 can be ruled out together as they both involve the fallacy that Soybean at this juncture make money at all. It certainly loses money when opportunity cost is factored in. Yield potential is challenged, climate needs are challenged and costs, well costs are the furthest thing from making Soybean a cheaper alternative to Canola – or Lentil for that matter.
What is fascinating is the real but hidden set of costs associated with Soybean. Canola is considered expensive to grow because fertility costs are so high while Soybean is cheap because there is almost no fertility bill at all. The reality is much different. Soybean rape the earth. They rape your next crop. They are a cereal rapist. Canola has the lowest removal rate of any core crop we grow on the prairies. When $90/acre is factored into Fertility costs for Canola, there is a $30 rebate left in your soil. When Soybean has a $5/ac fertility cost, it actually leaves your soil with $10-15 less than it had before seeding. That is a $40/ac relative cost for Soybean no one is telling you about. This is 3-4 bushels of your crop – 10-15% of your yield. Soybean is anything but cheap to grow even before that hidden cost.
The second thing no one is mentioning is yield. Averages in Manitoba are based on superior genetics in the heat-unit rated varieties they grow. When a new variety is acclimated to our growing degree days in Saskatchewan, it may now finish in our season but without the same yield potential. If Manitoba averages 31bu , Saskatchewan will average 29bu even if they have the same heat units or growing degree days – and that is a big if. In our area, Beans have averaged 27 in the last 3 years – and those were very Soybean-friendly years. Canola yielded 46 in that same stretch. If anyone is putting Soybean into their rotation at the expense of Canola they are non-idiotically challenged.
Lentils can be difficult to grow to be sure but the price potential is astronomical compared to Beans and that potential is being realized once again. If you are a decent lentil grower, who has managed rotations, there is no reason for you to grow Soybean, They rape your land, they take what Cereals would use the next year and suck it up like a sponge. Only Chickpea takes so much from the soil but Chickpea grant you a winning lottery ticket 3 out of 5 years. Soybeans will grant you a losing lottery ticket every year until genetics improve. So why are you being told to grow them?
Its very simple. It’s in the Who – as in who’s best interest is it in for you to grow Soybean? It’s the Soybean Supply Chain and a $110/acre seed sale.
The Seed sale is the last bastions of margin in the industry. Canola was the darling – a $40-50/acre sale at good margin was $10-15/acre of gross profit. Soybean seed trumps that by an X factor. What is the profit potential in a $110/acre sale of seed – a seed that is always ‘sold out’ so margins hold up? A good $25-30 /acre gross profit I would wager. It’s more money than you will make on Soybean themselves (remember those pesky fertility and opportunity costs).
When your Durum yields 5 bushels less the next year you will know the true value of your Soybean acre. You can do the math and can answer your own question – ‘why should I grow Soybean, the cereal rapist of Southern Saskatchewan’.
The answer is, “You shouldn’t'”.
John K Augerhandle MD is a freelance writer and an Op-Ed pseudo-name. He does his best work when controversy is required and unwieldy bibliographies, references, and supported facts just get in the way. He is an eccentric; a medical doctor with a knack for creating agriculture lore and a penchant for speaking in the third person. He has a monocle but wears it over an eye patch. He is not a pirate. He is credited with the controversial but stingingly accurate: Case Against Cost of Production Marketing, Why do we call it Marketing?, The Transportation Conflagration and numerous posthumous articles he continues to work on today. When he speaks, farmers listen. When he sleeps, the sun goes down. He is a man with too much power.