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Soybean Groups Show Sustainability to EU

When most farmers think of outside environmental challenges, the EPA may be the first big worry that comes to mind. Several large farm and ranching groups oppose the agency's recent proposals to define waters of the U.S. and expand regulations over small in-field streams and waterways.

But sustainability is also being used by the European Union in ways that are already hurting U.S. exports of soybeans to member nations.

The EU's Renewable Energy Directive (RED) looks at greenhouse gas emissions from oilseeds that are processed into biodiesel fuel and current standards favor rapeseed over U.S. soybeans, say leaders of the American Soybean Association and the United Soybean Board.

"I was over in Dubai last year, and they were actually importing Canadian rapeseed, making biodiesel, and shipping it to the European Union," said Scott Singlestad, a director on the United Soybean Board (USB) who farms near Waseca, Minnesota.

Singlestad was one of several farmers who joined reporters from and Meredith Agrimedia on a tour of nearby farms Monday that was part of the Confluence Project, a look at what farmers in the Midwest are doing to prevent soil erosion and maintain water quality.

The RED and its sustainable land use requirements were adopted in 2009, but the rule hasn't been phased in in all of the European Union's member nations. So far, only Germany, Denmark, Austria, and the Netherlands are putting the RED into effect. Yet, a recent independent study made for USB estimates that full implementation will divert $2 billion in U.S. soybean exports to countries outside of the EU, costing U.S. soybean farmers an estimated $270 million, or 8 cents per bushel a year. If soybeans from all exporting nations are diverted, the cost to American farmers would be greater, more than $1 billion, or 35 cents a bushel.

Under the RED, any biofuel has to lower greenhouse gas emissions by 35% compared to petroleum biodiesel in order to get EU tax credits and mandates. EU research pegs the reduction in emissions for biodiesel from U.S. soybeans at just 31%, making it ineligible. Soybeans from Argentina are being kept out, too, said Singlestad. Those from Brazil, Europe's largest supplier, still qualify, in part because Brazilian farms are going through on-farm audits to certify that the beans are grown sustainably on land that hasn't been converted from rainforest or other conditions that would release large amounts of carbon into the atmosphere.

To American farmers, the process seems a little mysterious.

"You've got to ask yourself, are they really trying to encourage people to do a better job, or is it a trade barrier?" American Soybean Association president Ray Gaesser, who farms near Corning, Iowa, told earlier this summer.

Brazilian soybean growing methods aren't dramatically different from those in the U.S., and it likely takes more energy – at least it costs more – to get the beans to Brazilian ports. And American farmers haven't cleared rainforest to plant soybeans.

"Why are they using Brazilian information to evaluate U.S. soybeans?" Gaesser asks, referring to the EU research. "The real answer is they're trying to keep our soybeans out."

Groups representing American soybean farmers have already met with trade officials in the Obama administration to urge that this issue be included in trade negotiations with the EU over a proposed Transatlantic Trade and Investment Partnership (TTIP). And ASA's treasurer, Richard Wilkins, a Delaware farmer, told a Senate committee this summer that the RED needs to be included in the talks over TTIP. The RED is just one trade barrier U.S. soybeans face in Europe. Labeling requirements for foods made with biotech ingredients have already diverted soybean oil from feed processing in Europe away from food products – into the biodiesel market that's also shrinking.

Meanwhile, USB and ASA are working to show buyers in Europe and elsewhere that American soybeans are grown in a sustainable way. The U.S. Soybean Export Council, which has ties to both ASA and the checkoff-supported USB, is using the U.S. Soybean Farmers Sustainability Report 2013 to document long-term improvements by the industry.'

According to the soy-checkoff-funded report, soil erosion per metric ton of U.S. soybeans produced has decreased 65% over the past 30 years, while energy use is down 46%, and greenhouse gas (GHG) emissions have dropped 47%. Yet yield has increased 53% over the same time period.

"As farmers, we are looking at how we can do continuous improvement," USB director Laura Foell recently told Her own family has been using no-till on their farm near Schaller, Iowa.

"In the U.S., we've had 75 years of conservation laws since the Dust Bowl," she said. Farmers' participation in farm programs amounts to a self-assessment of sustainability, since they have to show that they're meeting conservation compliance requirements, she added.

And USDA randomly spot checks for compliance, at the rate of 8% to 12% of farms per year, she said. In 2012, that amounted to 24,000 farms.

As head of the USB meal action team, Foell has met with buyers in Europe to convince them of the sustainability of American soybeans.

Editor's Note: Business Editor Dan Looker produced this article.


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