Saturday, 27 October 2012

Soybean Hype


Soybean Hype

Soybeans have been getting a lot of hype over the past couple months with acres in western Canada estimated to rise significantly for 2013. Soybeans are one of my favorite crops to deal with ever since I worked with some my first couple years of scouting. Soys do have significant upside for return, especially with the prices, but I want to talk about some things that seem to fly by the way side when I hear about soybeans lately.

Heat Units

We all know the benefits of soys in Saskatchewan for example, low disease pressure, lower input costs than canola, Roundup Ready trait, rotational benefits and the list goes on.

But we have to remember that breeding varieties suited to our Saskatchewan and Alberta areas is relatively new, and there still isn’t any really short season varieties. Our shortest varities are sitting in the 2325-2350 Heat Unit (CHU’s)  range. Generally speaking, there are some areas across Saskatchewan and Alberta that receive these sorts of numbers, but remember these aren’t CHU’s from May 1st, they are from May 15-25, once soil temperatures are in that 12-18 degree Celsius range! Now there will be some variation in varieties due to day length and other specialized traits some varieties have, but overall you want to get as close to those CHU’s as possible to achieve maturity with a decent yield. You would still get some yield if you only got 2150CHU’s for example, but the yield would be reduced along with the quality.

Moisture

Soybeans will use a good amount of water under ideal conditions, and aren’t deep rooters so scavenging for water is limited. The other consideration is that their peak water use occurs at later flower-pod development sort of time frame, for Saskatchewan and Alberta growers this is going to fall in that late July-early August time frame, which happens to be a typical dry time for us. The negative if we do happen to get a rainier than normal July is that could mean cool, damp conditions which aren’t what we want for our soybeans to reach physiological maturity.

Market

Soybean price is influenced in part by the USA, as we all know. Their drought is the main contributor to the large price jump of soybeans that sparked the increased interest in non-typical growing areas such as Saskatchewan and Alberta. We can’t be sure that the prices for soybeans are going to be as strong as they are now. The first reason being the largest ever seeded soybean acerage in South America (Brazil) and the forecast for good growing conditions (it is still early and a couple more months will tell how the weather affects them). This could significantly affect the price and bring it back down well below $15/bu. The other thing often forgot about is that the Americans will still be putting in another soybean crop around the same time as ours will be going in. The size of their acerage as well as conditions are ultimately going to play a role in where the price goes. Not that it’s a surprise to be a slave to the markets, but in talking with guys one thing that sparked interest in soybeans was the price. If large crops come off in S. America and the USA in the next 12 months then soybeans may be closer to $10/bu than 20$bu, and all of a sudden that 25 bushel an acre bean crop (which would be a high end average for a 2100 CHU, average moisture year, growing area) isn’t as profitable as once thought. Plus the risk of that early frost taking out a large chunk of your yield is always there.

I do believe that once the breeding is farther along and we can knock another 100-200CHU’s (or more) off of the shortest season varieties without sacrificing much yield we can grow soybeans with a consistent profit. There are even some areas across Saskatchewan and Alberta that can grow soybeans right now on a consistent basis. I am not trying to scare anyone away from soybeans, just play devils advocate to all the hype. I do hope producers still try some soys, but on a 20, 40, maybe 80 acre basis to start vs. an entire section. Trying small acreage now can get you the experience with them and develop a comfort level with producing them that allows you to be successful soybean grower once some shorter season varieties, more suited to your area are released.

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