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The markets have been a rollercoaster over the past year and producers have been along for the ride.
Commodity prices have plummeted, land rents have soared, and many of us are stuck with fertilizer and fuel that is extremely overpriced by today’s standards. Now, more than ever, it is imperative to find a way to
cut costs and find a crop rotation that maximizes your income potential. Conventional soybeans may be just the ticket. Many producers are opting for conventional soybean production rather than Roundup Ready beans,
because it makes economic sense to do so. Genetically modified soybeans have been good for producers with weed problems, but there are some real advantages to growing conventional soybeans. These include realizing
significantly lower seed cost, the lower risk of weed resistance and avoiding the rising cost of Roundup. Several producers have crop rotation that is exclusively Roundup Ready, which can increase weed resistance
and will exclude the producer from receiving premiums for commodities that have not been genetically altered.
There are also a number of opportunities to fetch a nice premium on conventional beans. Consumers are sending clear demand signals
that are pushing premiums that range from around $1 to contracts that offer more than $3 per bushel over the Chicago Board of Trade futures price. So, rather than getting hit with a wide basis at your local elevator
with GMO beans, conventional soybeans can create a $4-5 per bushel profit swing on your harvested crop. That adds up in a hurry.
As global economies improve, people first want to improve their diets and with better quality and safe food sources. Many Asian
countries, as well as others, are very cautious about genetically modified food products and will only purchase commodities that are not genetically modified. Food safety scares have also created a demand for
traceable food sources, particularly food grown in the United States and Canada.
I know you may be thinking that conventional beans are a pain to manage. The truth is, it is a little more work to control weeds and
pests on conventional ground, and you may have to make an extra pass or two with chemical. However, when you look at the economics, it will be well worth the extra management.
Another concern you may have is that conventional soybeans just won’t yield as well Roundup Ready beans. Many of you may have thought
this in the past, but the fact is, research and development of conventional varieties prove that yields are comparable and even better in some instances, along with drastically lower seed cost.
Conventional soybean production may not be the solution to all of our problems, but for a lot of producers, it will really pencil out
and help the bottom line.
Pat Breshahan is a farmer and partner in SB&B Foods, Inc in Casselton, ND. They have been exporting soybeans since 1988. The
partners in SB&B farm 4700 acres and raise wheat, non-GMO soybeans, corn, and alfalfa.
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