[UPDATED: June 14, 2021] According to some old forecasts Manitoba would be growing close to three million acres of soybeans annually by 2018 — challenging canola as this province’s top crop.
But last year Manitoba farmers grew just 1.04 million insured acres of soybeans marking the third year of decline since plantings peaked at a record 2.05 million insured acres in 2017.
Earlier this year Statistics Canada predicted plantings of 1.3 million acres, up 17 per cent from 2020 ending the slide that began in 2018.
Why it matters: Manitoba’s early soybean acreage exceeded expectations giving rise to predictions it could rival canola. Despite setbacks the soybean sector is hopeful.
One of those predicting higher acres was Bruce Burnett, director of markets and weather for MarketsFarm. (MarketsFarm, is owned by Glacier FarmMedia, which also owns the Manitoba Co-operator.)
In 2013 Bruce Burnett, then the Canadian Wheat Board’s director of weather and market analysis, predicted by 2018 Manitoba could have three million acres of soybeans. It was a bold statement and intentionally provocative, he admitted.
“It’s close already,” Burnett said in an interview Oct. 22, 2013.
That year a record 1.06 million acres of soybeans were insured in Manitoba, compared to 3.26 million acres of canola and 2.8 million for all types of wheat.
But it was not to be.
“Things were going well until we ran into some dry August weather,” Burnett said in an interview June 3.
A shortage of rain in late July and early August saw provincial yields average just 34, 31 and 28 bushels an acre in 2017, 2018 and 2019.
The 10-year average is 34 and the record is 42 set in 2016.
Meanwhile, farmers’ love affair with canola, the Cinderella crop, continues. StatsCan predicted Canadian canola seeding this spring would increase for the first time since 2017, rising 3.6 per cent to 21.5 million acres — the largest seeded area since 2018.
StatsCan also predicted Manitoba farmers would seed less canola — 3.2 million acres, down almost six per cent from 2020. However, the forecast was based on data collected in March before old-crop canola prices exceeded $20 a bushel, which may have encouraged more canola planting.
What’s more, canola crushing is ‘having a moment’ with three new plants recently announced and an established one to double its output.
Annual canola-crushing capacity of 11 million tonnes is set to increase by 5.7 million tonnes or 52 per cent. Based on current annual canola production of around 20 million tonnes, after the expansion Canada will be able to crush 84 per cent of it.
A drop in yield wasn’t the only problem. World oilseed markets changed too.
In 2013 soybeans enjoyed more than a buck a bushel premium over canola, plus lower production costs, Burnett said.
Now world vegetable oil markets are the tightest they’ve been in years giving canola an edge in profitability, he said.
Robert Day, CEO of Ceres Global Ag, who operates Manitoba’s lone soybean crush facility at Jordan Mills, made the same point.
“Prices for other crops are really high,” he said in an interview May 7. “Before soybean acres were increasing because everything else was pretty dismal so it was a better alternative for the farmer. They’ve got good alternatives today… ”
So what does the future hold for soybeans in Manitoba?
It’s likely soybean acres will go up again, Burnett and others say.
Given how plantings grew in the early years previous it’s easy to understand the optimism.
In 1998, 118 Manitoba farmers insured just 10,932 acres of soybeans, crop insurance records show. Average yield — 30 bushels an acre.
By 2016 insured acres had increased 150-fold and the five-year average yield was 35 bushels an acre.
Part of soybeans’ early appeal was how well they held up under wet conditions in spring and early summer, especially compared to canola. Dry conditions have obviously capped that appeal.
One issue that’s hampering development of the sector is processing capacity, where the crop is stuck in a ‘chicken-or-egg’ moment — a processing plant needs enough acres to justify its construction, and those acres might not come without that market.
There’s a faint glimmer of hope on that front. Day says Ceres is expanding its Jordan Mills operation by more than 50 per cent. Still it’s a relative drop in the bucket, with production set to jump from 70,000 tonnes a year to 105,000 tonnes at the facility, set at the junction of PTH 3 and 23. It’s a far cry from the million-tonne plant many in the sector have hoped for.
“There aren’t enough beans in Manitoba to justify a one-million-tonne plant,” Day said. “There’s only about a million tonnes of beans grown. So we (Jordan Mills) are appropriately sized for that market.”
But when conditions are right Ceres would consider building a large soybean-crushing plant in Manitoba, Day added, but probably not at Jordan Siding.
Ceres announced May 25 plans to build a $350-million, 1.1-million-tonne canola-crushing plant at Northgate, Sask.
Like Burnett, Day sees growing demand for soybeans.
“In the next four years or so we are going to add three billion gallons of renewable diesel capacity in the United States,” Day said. “And in order to feed the demand for renewable diesel they’re going to need nine million to 10 million tonnes of vegetable oil because… today the U.S. and Canada only produce 17 million metric tons of soybean and canola oil and it’s all being consumed. So for us (industry) to produce 50 per cent more we need to add a lot of oilseed crush capacity.”
However, in the short term, canola, which has a higher oil content than soybeans, has the advantage, he added.
“Where they can plant canola they are probably going to choose that, but where soybeans make more sense because of agronomics then soybeans will be a great alternative,” Day said.
That’s where the Manitoba Pulse & Soybean Growers (MPSG) comes in.
“The end-game is to get soybeans as a more significant, constant presence in Manitoba — a higher acreage on a constant basis so then we can seriously start to talk about attracting large-scale processing,” MPSG executive director Daryl Domitruk said in an interview May 26.
*To that end MPSG has invested $440,000 over four years to boost soybean protein and make it more stress tolerant.
Soy Canada is also committed to helping improve western Canadian soybean production, executive director Brian Innes said in an interview May 28.
“We know a lot of farmers in Manitoba like growing soybeans because they are relatively straightforward to grow, their input costs have been good for the farmer’s bottom line mainly because they don’t use nitrogen — and this year nitrogen has been expensive — and pest control we’ve managed so far to avoid major pest issues, so their cost of production is something they can reliably pencil in,” Domitruk said. “So there is a desire to grow them.”
There’s also an agronomic benefit, Ray Redfern, president of Redfern Farm Services with outlets across western Manitoba, said in an interview June 2.
“I am determined to try my best to convince growers it’s better to grow more than two crops,” said Redfern, who is also chair of Westman Opportunities Leadership Group (WOLG). WOLG, made up of business, farm and civic leaders from western Manitoba, was founded in 2016 to build the case for a major soybean-crushing plant in western Manitoba.
“I am happy with canola, but I am scared stiff about the outcome that comes in terms of everything from weed resistance to other issues like clubroot, let alone soil health that we need crop diversification to achieve,” Redfern said.
There’s enough Manitoba soybean production now to justify a plant but with acreage increasing again and better varieties each year, the case for a plant gets stronger, Redfern said.
A Manitoba soybean crush plant would enjoy a $35- to $50-a-tonne advantage on freight costs between the delivery of Manitoba-grown seed to a plant and the movement out of soymeal to Manitoba livestock farmers.
The 1.5-million-tonne-capacity crushing plant ADM says it will build at Spiritwood, North Dakota about 130 km west of Fargo, is too far enough away to be a threat to a Manitoba plant, Redfern said.
*Update: The original story reported the Manitoba Soybean & Pulse Growers Association had invested $750,000 over four years to boost soybean protein levels in Manitoba. In fact MPSGA has invested that amount into edible bean research. It invested $440,000 into soybean protein.