This is the first part of a three-part series from Virginia Tech examining the rapidly changing landscape of sustainability in the global soy market.
Last month's passage of the Farm Bill, after more than three years of Congressional wrestling, marks the first major effort to reshape the U.S. food and agricultural sectors in the past five years. The bill is filled with green victories, including funding to expand farm-to-school programs and seed projects to make fresh fruits and vegetables more affordable for lower-income families.
Despite years of talk about reform and innovation in Congress, the "meat and potatoes" of the Farm Bill still remains nutrition assistance and commodity crop programs. The final version of the bill also contains a host of policies and programs designed to influence the planting, production and price of soy. As the second-most widely planted crop in the U.S. following corn, soy is planted on 74 million acres of farmland and produces $38 billion annually.
What's different is that compared to five years ago, the Farm Bill's impact on soy production has diminished. The primary drivers affecting soy production today are the same ones that now affect all global food industries: climate and water; increasing consumer concern about health; and growing affluence around the world.
To help with this issue, groups such as the WWF Roundtable on Responsible Soy (whose participating members include Marks & Spencer, Nestle and Shell) are working to promote greener options on a global scale.
Here's how key drivers are affecting the production and sustainability of soy.
1. Climate and water
Concerns about climate and water have driven changes in how much soy U.S. farmers plant. Mandates for corn-based ethanol fuels have driven down soy acreage; at the same time, floods and droughts in recent years have reduced yields per acre. This has lead to increased research efforts, including USDA-funded soybean and agronomics research conducted by Virginia Tech's Department of Agriculture. That research aims to develop cultural practices and identify varieties that enhance farm sustainability through increased productivity, production cost control and reduction or elimination of environmental impact.
The drought and warmer temperatures across the western United States also have affected the livestock industry, which consumes about half of all soy produced domestically, leading U.S. livestock producers to increase imports of soy for animal feed. The drought and warmer temperatures across the western U.S. also have affected the livestock industry, which consumes about half of all soy produced domestically, leading U.S. livestock producers to increase imports of soy for animal feed.
Brazil quickly is emerging as the world's second-largest soy exporter with a harvest of 67 million metric tons in 2013, just 7 million less than the U.S. While Brazil's agricultural production capacity has been expanding to meet global food demand, soy and livestock production has also historically driven rates of deforestation because, in addition to increasing output per unit of land through intensification, new land is also being cleared for cultivation.
2. Consumer health
Concerns about trans fats present in hydrogenated vegetable oil and their connection to cardiovascular disease has eroded the market for soy oil. During the past eight years, food companies have worked ahead of regulation to eliminate trans fats from most products. Trans fats are now present in smaller quantities, mostly in baked goods, oils used in restaurants, and artificial creamers and dairy replacements.
In November, the U.S. Food and Drug Administration indicated it soon would characterize trans fats as no longer generally safe for human consumption. Food manufacturers have been looking for new replacements while hoping to avoid a sudden and dramatic jump in global demand in palm oil as a replacement. Since 2008, U.S. consumption of soy for baking and frying has dropped by more than half.
3. Growing global affluence
Increasing affluence is the wildcard of soy production. Because more households across the globe have more money to spend, they have the luxury of choosing what to eat, rather than wondering if there will be anything to eat. The growing middle class in the U.S. and around the globe has enough purchasing power to decide whether to choose a healthy diet abundant in fruits and vegetables, or to eat meat more often. That choice, made country-by-country and meal-by-meal, could push demand for animal feed and soy beyond the limits of any sustainable harvest and farther into the forests of Brazil.
Rich in water and arable land, Brazil provides a critical link in the global supply chain, serving as an economic powerhouse for global agricultural production. Brazilian Amazonia is a region where the convergence of these drivers is playing out in real-time. Amazonian forests are responsible for a quarter of the world's terrestrial species, about 15 percent of global terrestrial photosynthesis, and evaporation that powers rain and other weather systems as far away as North America. Agriculture and other forms of development already have altered nearly 1 million square kilometers of forests. The peak of documented deforestation was in 1995, when almost 30,000 square kilometers of forest were cleared. Successful intervention strategies have slowed that rate over the most recent decade, until last year when it shot up 28 percent to an annual rate of nearly 6,000 square kilometers.
For these reasons, soy production in the Amazon remains the focus of well-funded and visible global sustainability efforts to increase responsible agricultural production while maintaining ecosystem services.
Soybeans photo by skyfotostock via Shutterstock.