As a key industry partner with the American Soybean Association (ASA), I am writing to update you on recent developments within soybean farmer organizations regarding international marketing and competitiveness activities.
As you know, the ASA has played a key role for five decades in developing international markets for U.S. soybean farmers. Since 1956 ASA has been a foreign market development cooperator with the Foreign Agricultural Service (FAS) of the U.S. Department of Agriculture, and since inception of the national soybean checkoff in 1990 the ASA has been the primary contractor that carries out international marketing on behalf of the United Soybean Board (USB). Approximately 40 percent of ASA’s International Marketing funding presently comes from USB. The majority of funding comes from FAS, with additional contributions provided by various state soybean checkoff boards.
A few weeks ago, the ASA learned USB’s executive committee would recommend that USB not contract with ASA in fiscal year 2006 to carry out international marketing and competitiveness activities. The news of these recommendations came as a surprise to ASA and was perplexing, particularly in light of the association’s very successful record in international marketing. As you know, the U.S. soy industry has achieved record soy exports in three of the last four years, and U.S. soybean farmers last season enjoyed the highest prices in 30 years due to strong foreign demand for a drought-reduced U.S. crop.
Since this original announcement, ASA has received an outpouring of support from the state associations and state checkoff boards representing well over 85% of U.S. soybean production for ASA’s continued key role in international marketing, along with the direction that ASA and USB leaders roll up their sleeves to find a mutually acceptable way forward that is in the best interests of soybean farmers. Over the past several weeks, farmer-leadership of ASA and USB has met numerous times to find an equitable solution. ASA
Last week, the ASA and USB Boards met independently in St. Louis. At its meeting, the ASA Board adopted a resolution directing ASA leaders to continue good faith discussions with USB to find way forward in international marketing and competitiveness, with the goal of reaching a mutually acceptable agreement by February 1, 2005. The USB Board adopted a similar motion, but with the additional statement that USB will not enter into International Marketing and Competitiveness contracts with ASA in FY06, which begins October 1, 2005.
ASA and USB leaders are committed to continuing the good faith discussions over the next 45 days to find a mutually acceptable way forward. ASA leaders are insistent that any way forward and potential new approaches in international marketing and competitiveness meet all of the following:
- It must be in the best long-term interests of soybean farmers
- It must protect ASA’s years of investment and role in international marketing
- It must protect the Association’s long-term vitality and viability
The discussions being held among ASA and USB leaders are farmer-to-farmer only and do not include staff. Under discussion are models that preserve the continued roles of ASA and USB farmers in setting the strategic direction for international marketing, and that retain the ASA International Marketing brand recognition and trust that has been built in the last 48 years among foreign buyers. ASA’s name is not being sold.
At the ASA Board meeting, ASA also received from its independent auditor a clean, “unqualified” audit report of ASA’s operations and accounting policies, the highest level an organization can receive. Additionally, the USB chairman, vice chairman, and treasurer all have assured ASA that it is in compliance with the international marketing and competitiveness agreements between ASA and USB.
The ASA has played the key role in the international marketing of U.S. soybeans and soybean products for nearly 50 years. ASA remains hopeful about reaching a mutually acceptable way forward.
Should you have questions, please do not hesitate to contact me. Sincere thanks for the support you and your organization have shown ASA and America’s soybean producers. May you and yours have a joyous holiday season.