Thursday, September 13, 2012

Soy, the other green gold

Growing soybeans here in the Corn Belt has long been the "other" crop.  It can be planted after all the other crops because it requires a shorter growing season.  It is often rotated with corn because soybeans can "fix" nitrogen in the soil.  Corn consumes nitrogen at furious rates so a soy rotation is considered good land management.  The drought that has so devastated the corn crop is of course, doing in a lot of beans.

Soybeans have an interesting history in USA.  It is a non-native crop that exists because someone promoted the heck out of it.  In this case, that someone was Henry Ford who promised to use them in the production of his cars.  Soy CAN be turned into plastic so this promise was largely kept.  Over the years, clever scientists have found a wide range of useful products so the soybeans have grown from a niche crop to one that has enormous economic implications.

Grain Analyst: The US Is Running Out Of Soybeans

Rob Wile | Sep. 11, 2012

The worst Midwest drought in 76 years will leave the country with its lowest soybean inventories in four decades, Bloomberg's Jeff Wilson and Tony C. Dreibus report.

The pair talked to a grain analyst who painted a disturbing portrait of the country's soybean harvest:

"The U.S. will simply run out of soybeans” for exports on March 1, said Doug Jackson, an FCStone vice president in West Des Moines, Iowa, who has been a grain-industry analyst since 1974. “The supply situation is unprecedented. The theoretical maximum South American shipping capacity may fall short, leaving world buyers wanting.

Reserves will be the lowest since 1973 by March, estimates INTL FCStone Inc., which handled $75 billion of physical commodities in 2011.

In July, Goldman predicted soy futures would reach $20 a bushel by October. Prices currently stand at $17.14. more
$17 soybeans will seduce a lot of growers.  In fact, Argentina has turned soy into the mainstay of its economy to such an extant, the humble nitrogen-fixing bean that can be eaten as tofu has become a nasty environmental problem.

Soy production endangers Argentina

Anne Herrberg  03.09.2012

Argentina’s soy industry saved the nation from the 2001 economic crisis. But the impact of soy production on Argentinians and the environment in nearby regions has been devastating - and yet the state turns a blind eye.

The case of the Supreme Court in the Cordoba province was supposed to be a unique and somewhat historic moment in Argentina's judicial system. It was the first time ever that an Argentine judiciary dealt with the use of pesticides in agriculture. Two soybean producers and a pilot who sprayed the chemicals onto the fields were accused of violating safety regulations that prohibited the use of chemicals near residential areas. They were on trial for endangering the health of the residents of Itunzaingo, a suburb of the provincial capital Cordoba.

Yet, at the end of the three-month trial in August, the judge's verdict was considerably mild: a three-year suspended sentence and community service order for soy producer Francisco Parra and pilot Jorge Pancello. The third defendant was acquitted for lack of evidence.

"They're making us sick, they're killing our children, but they're not going to jail for it," Silvia Gatica said.Disappointment and anger are written all over her face. In 1989, just three days after she gave birth, Gatica lost her daughter to kidney failure. There were five similar cases in her neighborhood Ituzaingo alone, a community where deformities in newborns are mounting, and the number of people with cancer is double the national average. Silvia Gatica was sure this was no coincidence.

Ituzaingo is situated much like a small island in the middle of soy plantations. Aircraft and high-tech tractors regularly spray herbicides and insecticides such as glyphosate and endosulfan onto the fields. In 2004, Silvia Gatica and other mothers and residents pressed charges against the farmers. Now, a medical report confirmed that the poison does not only end up on crop fields, but can also be found within the residents' bodies - especially in children. “It was an achievement that the matter even went to court, but the judgment was a slap in the face,” Gatica said.

The case of Ituzaingo, however, is by no means an isolated case. About 340 million liters (90 million gallons) of pesticides are used in Argentina annually on 19 million hectares (73,400 square miles) of land where around 12 million residents reside. In 2009, Argentine President Cristina Kirchner appointed a commission of scientists and experts to examine the effects of agro-chemicals. Three years on, there has been no outcome.

"We know that a lot of pressure was put on the court," says doctor and co-plaintiff Medardo Avila Vazquez. The international agricultural company Monsanto wants to establish itself in the area around Cordoba, and its endeavors are supported by the government. "So it's a battle of us citizens against national and economic interests," he says. But last year's agricultural development plans reveal that soy and wheat cultivation will be expanded even further.

Argentina is the world's third-largest soy producer. Apart from meat, soy is the country's most important export commodity. The biggest purchases come from China, and in particular the European Union, where the oily bean is processed into bio-fuel and livestock feed. Its strong market price, globally, enabled soy to rescue Argentina from the severe economic crisis that hit in 2001, and the crop continues to play an important part of the country's revenue. In 2011, Argentina converted around 25 billion euros ($32 billion) from soy cultivation alone. Today, soy production is expanding more and more, even in the northern parts of Argentina, areas once considered too dry and uneconomical to produce soy. But with genetically modified seeds, which were introduced to Argentina in 1996, it's now deemed possible. The "green gold" soybean can be produced using virtually no water. However, the consequences for people and the environment are devastating.

Argentina has lost 70 percent of its natural forest, much of it in the last 20 years, with increased soy production. Aerial photographs taken by Greenpeace Argentina reveal the extent of deforestation. One area especially affected is the ‘El Impermeable' or ‘impenetrable' savanna forest in the northern Chaco region. more

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