Soybean checkoff remains financially responsible

Farmer-leaders of the United Soybean Board (USB) and soybean checkoff met recently in Louisville to review the state of their industry and set funding priorities for the 2008 fiscal year. USB directors from across the nation reviewed soybean checkoff programs, discussed strategic approaches for their programs and set funding levels to protect their investments well into the future.

“Every checkoff dollar invested is done with forward thinking and it’s obvious that our board has been effective and efficient in the way we do business,” says Eric Niemann, USB chairman and a soybean farmer from Nortonville, Kan. “As we continue in our roles as stewards of the checkoff, it is imperative we remember our fiduciary responsibility to act in the best interest of all soybean farmers and to judiciously invest funds as they become available.”

In the current fiscal year, USB is working with a budget just over $44.5 million, and checkoff farmer-leaders set an initial budget of just over $47 million for fiscal year 2008. Niemann stressed that it is always the goal of checkoff farmer-leaders to allocate funds as they become available, as was evident at this meeting.

Approximately $6 million dollars was made available due to increased checkoff collections. These monies allowed each USB program area to become fully funded for 2007, a goal that was not able to be met previously because of uncertainties in the marketplace.

During the meeting, checkoff farmer-leaders evaluated the long-range strategic priorities of each program area as well as the ability of each program to impact the market.

Efforts by the checkoff will continue in areas such as the development of industrial uses for soy, including soy biodiesel, and soy flexible foams and solvents. The checkoff-funded National Biodiesel Board estimates 2006 biodiesel sales totaled 200 million gallons and that nearly 3,000 U.S. fuel distributors and retailers now carry biodiesel.

Other industrial uses for soy continue to be on the rise, such as soy foam for automobile interiors, carpet-backing and furniture.

Going into the next year, the checkoff will remain focused on expanding the inclusion of soy into Asian, North American and European markets. Currently U.S. soy has the fewest trade barriers among all world agricultural exporters, and U.S. soybean farmer-leaders have representatives in over 80 countries around the globe.

Another strategic focus for 2008 will be the ongoing commitment to support the domestic livestock and poultry industries. Efforts will continue to drive education of the importance of these industries to the U.S. economy and soybean industry, but also will focus on identifying new soybean varieties that better meet the needs of animal feeds.

Turning to the human side of the marketplace, supporting the demands of the food industry will remain a top priority in the next fiscal year, with particular emphasis on the edible soybean oil market. Despite significant leaps in biodiesel usage, the great majority of the oil crop still goes to edible oil markets.

Soybean checkoff farmer-leaders took a side trip during the board meeting to visit the nearby headquarters of Kentucky Fried Chicken (KFC). YUM Brands, Inc. recently announced that all 5,500 KFC locations would be switching to low-linolenic soybean oil in their frying applications starting in April of 2007. This is great incentive for soybean farmers regarding the growth of specialty soybean varieties.

In addition to setting strategic priorities, checkoff farmer-leaders also learned more about how their industry is preparing for the future through Soy 2020. Soy 2020 was created to develop a vision for the future of U.S. soybeans, one that will provide opportunities for organizations across the soybean value-chain to anticipate and prepare for their future by the year 2020. Soy 2020 will roll out the vision and supporting strategies at Commodity Classic, March 1-3 in Tampa, Fla.

Rounding out priorities for 2008 will be an ongoing commitment to production research and improvements to compositional quality. In addition, the checkoff will continue its efforts to identify and measure specific quality components in the bean, such as amino acids.

“Over the years, farming has changed quite a bit, but the farmers managing their operations have not,” says Niemann.

“The soybean checkoff has effectively leveraged funds for nearly 20 years to maintain markets and ensure the creation of new ones. Soybean farmer contribution rates never changed during this time, and, because of efficient business practices by this Board, U.S. farmers have remained competitive. I look forward to working with our farmers to continue this success well into the future.”

In an effort to remain financially responsible, USB will hold an open request for proposals from qualified companies for its fiscal year 2008 communications contract this summer. USB is mandated by the Soybean Promotion, Research and Consumer Information Act, under which it operates, to annually evaluate its programs and program contractors.

USB is made up of 64 farmer-directors who oversee the investments of the soybean checkoff on behalf of all U.S. soybean farmers. Checkoff funds are invested in the areas of animal utilization, human utilization, industrial utilization, industry relations, market access and supply.

As stipulated in the Soybean Promotion, Research and Customer Information Act, USDA’s Agricultural Marketing Service has oversight responsibilities for USB and the soybean checkoff.

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