Demand for Non-GM and Organic Soy Growing
Editors, Progressive Farmer -- Friday, October 06, 2000 

The U.S. has become the supplier of last resort for corn and soybeans
thanks to the controversy over genetically modified (GM) crops, according
to Jim Skiff, president of USSoy in Mattoon, Illinois. 

USSoy is a supplier of third-party-verified, identity preserved food grade,
non-GM or organic soybeans and processed food-grade, non-GM or organic soy
grits, flour, and meal, as well as soy oil, textured and roasted soy
products that have been mechanically, not chemically, pressed or extruded.
He also sells similarly processed flax oil and meal.

Skiff notes that his European and Asian customers, who are primarily food
processors, have recently indicated that the retail customers "want to know
the country of origin and often refuse to buy U.S.-origin non-GM or organic
products. They are now buying from Canada and Brazil and getting what they
want at a cheaper price than I am willing to sell them," says Skiff. "It
looks like the U.S. policy on GMs has helped build a pretty good market for
these other countries, which are willing to produce exactly what the
customers want."

While U.S. producers may feel that the GM controversy in Europe has died
down, Skiff says "the Europeans have moved on, and we are getting ready for
a second wave," he says. "The legislation regarding GM tolerances for food
is in place. Right now the EU is debating how much GM crop should be
allowed in animal feed." 

In fact, Skiff said he recently had a call from a "fairly large" northern
European feed company trying to line up substantial supplies of non-GM and
organic soy to be formulated into animal rations.

The primary growth area in U.S. commodities is in organic production, Skiff
says. In the U.S. this market is growing at the rate of 20% a year; in
Japan 25%; and in Europe by 28 to 30%, he notes. In fact, the market is
becoming so particular that the hexane-extracted soy isolates currently
used to add protein to many beverages are now being rejected in favor of
mechanically produced isolates. 

"Even if it's grown and certified as organic, once a soybean is exposed to
hexane, a synthetic chemical, it's no longer considered organic," Skiff
explains.

This organic niche offers "tremendous value-added potential" for U.S.
farmers who are willing to undergo the three-year transition to intensive
management practices, which involve weaning from chemicals and a shift to a
three- to five-crop rotation. Skiff currently is paying from $13 to $17 a
bushel for organic soybeans. All of his production is contracted and is
subject to third-party verification from seed production and storage
through planting, growing, harvest, transfer, storage and processing. 
"We maintain a paper trail of signed affidavits so that a buyer can
literally visit the field and the farmer who grew his order," he says.