Area farmers take part in soybean mission trip to Philippines, Malaysia
WORTHINGTON -- Minnesota Soybean Growers Association representatives Matt Widboom of Worthington and Bob Nelsen of Westbrook returned from a soybean growers mission trip to the Philippines and Malaysia just in time to experience a southwest Minnesota blizzard on Tuesday.
It was quite a change from their excursion to the sub-tropical climate of southeast Asia, where they toured milling companies, livestock production facilities and large-scale farming operations. The 11-member group also met with soybean buyers, consumers and trade representatives.
The soybean growers mission trip, hosted by Omaha, Neb.-based Ag Processing, Inc. (AGP), departed Nov. 28, and included farmers from Minnesota, Iowa and Nebraska. AGP began hosting the trip about half a dozen years ago as a way to introduce Midwestern soybean farmers to their overseas customers. Outside of the United States, the Philippines is AGP's top customer for soybean meal.
The group's first stop was in Manila, Philippines, where they met with buyers of U.S.-produced soybean meal.
"We had informal meetings with them and learned about their use of our products in aquaculture -- fish feeding," said Widboom, adding that aquaculture is big business in the country. At one mill they visited, more than 300 varieties of fish food were processed, from starter to grower and finisher. In addition to rearing Tilapia, fish farmers also grow white fish and grouper.
The group stayed in Makati City, in the heart of metropolitan Manila, with excursions through the vastly poor, rural regions on their way to tours of milling operations.
"They always say how hard up the people are -- especially in the Philippines, and man, they are," said Nelsen, who is an at-large director on the Minnesota Soybean Growers Association board. "People are living in 8 by 8 shacks, kids running in the street -- some without any clothes on at all. ...There's no public schools at all, and the unemployment is a whole lot worse than the United States."
Many of the farmers have just a hectare of land on which to grow their crops, using plows pulled by oxen to do the field work. Rice is among the country's largest crops.
"My most memorable part (of the trip) was conversations with the family businesses -- how much they value family ownerships and working together," Widboom said.
While the American group's mission to the Philippines and Malaysia wasn't to convince the country to purchase more U.S.-produced soybean meal -- although that would be a positive indirect result -- Widboom said the trip focused more on bringing producers eye to eye with overseas consumers.
In doing so, they heard numerous comments about the high price for U.S.-grown products.
"We showed them the price might be more, but in the long run you're getting a superior, consistent product," he said. "Price and quality are the same in business, no matter where you're at."
According to information published in a Philippine newspaper while the farmers toured the country, the U.S. once supplied 65 percent of the country's 1.5 million metric ton soybean meal imports. While the country's import needs have declined due to animal diseases and a series of destructive typhoons, the amount of U.S. soybean imports has dropped to less than 292,000 metric tons. The dramatic decline is due primarily to the increase in soybean imports from Argentina.
"We thought if we could get some of that market ... that would really turn out well," said Nelsen. "We're going to have a surplus of corn and beans. To get rid of it, we have to export 55 percent. China takes a lot, but if we could sell to some of these other countries.... They haven't been happy with the product from Argentina. We don't want to screw this up."
Nelsen said part of their trip included visits to a major hog producing facility that had 35,000 sows, and a poultry facility that was looking to increase from 400,000 to 1.2 million. That amounts to a huge increase in need for soybean meal -- and a potential opportunity for the U.S. soybean market.
Following their tours in the Philippines, the group traveled to Malaysia -- a first for the AGP-led trade mission.
"Malaysia is a very competitive market for us to get into," said Widboom.
While there, the group met with representatives from the U.S. Grains Council and the American Soybean Association about trade barriers between the U.S. and Malaysia.
"They firmly believe the U.S. needs to establish free trade agreements with the southeast Asian countries that will allow us to be competitive," Widboom said. "They are on the verge of signing free trade agreements that will put us at a market disadvantage, primarily because of the tariff they will be implementing.
"We're going to be continually challenged to get into that market without a fair trading field," he added.
Nelsen said he would like to see the legislators get involved to improve trade deals with countries like the Philippines and Malaysia.
"Buying from the big companies, that's what they get disgusted with," Nelsen said. "They'd rather buy direct from the farmer."