Much has been said about the U.S. farmer's ability to compete in the world soybean market in the face of steadily increasing competition from Brazil and Argentina.
But what if the issue at hand isn't about vying for market share?
“It's not so much about losing market share. It's about being able to profitably sell all that you produce. The ideal price is that which sustains food producers while providing value for the consumer,” says Al Ambrose, vice president, oilseeds product line, Harvest States, Inver Grove Heights, MN, and chairman of the international trade committee for the National Oilseed Processors Association.
“The objective shouldn't be to constrain supply at the expense of consumers, but rather to profitably produce an ever-growing food supply for an expanding world demand,” he says. “World soybean production has advanced by 10 million metric tons, on average, each of the past seven years and yet supplies remain tight.” He notes that soybean prices reached a new five-year high this spring.
“Clearly South America is a fierce competitor in the global soybean business, but she might also be viewed as our partner in food supply,” says Ambrose. “Without the exportable surpluses of both hemispheres (North and South America) in alternating seasons, the global livestock base would never have reached its present size. Global soybean meal usage has grown by 87% over the past 12 years. It's likely the world is consuming twice as much protein today as in the late '80s, a breathtaking rate of growth.”
He adds that opening markets through trade reform creates a bigger market for the world's food producers while more economically feeding the world's hungry. “As their unit cost shrinks, they'll buy more, eat better and the world's producers will have a larger demand base,” says Ambrose. “It's a win-win on a massive scale.
“There's plenty of demand for food in the world, but there's not enough purchasing power. We need to keep expanding trade and opportunity,” he says. “We don't want to give people fish, we want to teach them to fish. Don't give people the food, give them a job. Give them the opportunity to buy food, because without people to purchase food, you won't have anyone to support production agriculture.”