Transcript
Speaker: Hello, my name is Stephen Kilgarn. I'm the managing editor of Feeding Grain Magazine and the host of the Feeding Grain Podcast. Thank you so much for joining me today as we dive deep into the issues affecting the feed manufacturing, grain handling, and allied industries.
Speaker: Today's episode is brought to you by the Binwhip from Numat Systems. The powerful dual impact Binwhip removes the toughest buildup and blockages in industrial storage silos without hazardous silo entry.
Speaker: Learn more today at binwhip.com. Today, my guest is Tom Delfonso, Director of Animal and Aquaculture for the U.S. Soybean Export Council. We sat down at IPPE to talk about what's happening in the soybean export and domestic market, why U.S. soybeans are the best in the world, and opportunities to expand and build the market.
Speaker: I hope you enjoy the interview. If you want to help out with the podcast or listening to this in a podcasting app, please rate us and subscribe. listening online, sign up for the Phoenix Gray newsletter, Industry Watch, to see when podcasts drop and stay up to date with news from around the industry.
Speaker: Thank you for listening. And now, on to the show. Hi, Tav. Thanks for joining me the today. Hi, Stephen. Great to be here. recording live from IPPE, which is always fun. But for anyone who might not have the opinion of mine telling me what you do with industry, yeah this is your place.
Speaker: Absolutely. I'm the worldwide director of animal utilization and aquaculture for the U.S. Soybean Export Council. We're here at IPPE. It's my 35th year coming before it was even called IPPE. It was Southern Poultry Society's scientific meetings.
Speaker: And I'm just excited to be here. It's always a great way to start off the year with this show in January. eds I thought I was bad at 11 years. 35, before it even became co-mingled. Exactly. That's brilliant.
Speaker: yeah Just talk a little bit about the world of soy. What's going on? How was 2024 for U.S. soybean farmers, especially when it comes to our export markets and things like that? It's a very exciting time. There's a couple of big dynamics going on.
Speaker: The first is that the U.S. is crushing more of their own soybeans to produce oil for biofuels and to feed the growing industries of animal production and human food consumption in the United States.
Speaker: But for the export, it's so exciting. The world is seeing more animal protein being consumed. That growth is really driving the need for high quality ingredients in animal feed.
Speaker: Those are trends that are going to continue. And soy is the most important ingredient in an animal diet. Oh yeah, it seems like everyone and their mother is building a soybean crush and aviation fuel refinery. But I might be a little biased, but the U.S. does produce the best soybeans in the world, I think. So the fact that it is a market out there for it, for all these other countries and who are starting to see the value on it. Talk a little bit about your guys' is work promoting that value to the rest of the world.
Speaker: Absolutely. And I always like starting the story with the U.S. soy farmer. These are family-owned farms that have been in the family business for generations. And when we talk about sustainability and quality, it really comes down to the business benefit of practicing sustainable farming in the United States.
Speaker: For example, using variable amounts of inputs to the soil like fertilizer is both a cost savings, because you only use it where it's needed, but it also makes us the farm more uniform.
Speaker: in the production of soy and its quality. And one of the big value drivers of U.S. soy is the consistency of the nutrient composition. And that comes from the sustainable farming practices, harvesting, and the supply chain that create a high consistent, high quality product. And we're lucky enough to have such a big area where we can grow soybeans too. So even if one area is hit by drought or flood or whatever, lot of other places that kind of pick up the slack. So we always seem to have these very deloitte argument in here. Right.
Speaker: Correct. And I think part of that speaks to the resiliency. So, for example, rivers, roads, and railways, we have an infrastructure that gets the soy to the market around the world. Yeah. And how do you feel the transportation network is holding up now? It increased quality and increased the speed output for all our facilities. How is our transportation for network work really holding up?
Speaker: it's It is very resilient. And one of the benefits of U.S. soy is that we move large quantities. So on on rivers and railways, roadways, we're able to transport large quantities. So there's just less damage, less touching, let's say, of the material before it gets market.
Speaker: We don't need to mechanically dry the beans. So the damage is very low. There's no incidence of heat damage that we see in other parts of the world where they need to dry the beans because of the very high moisture content.
Speaker: Yes. And so whenever you're thinking about the supply chain, you think about the quality of the product from dirt to dinner. And U.S. soy delivers value at every step of the way.
Speaker: Once again, I might be a little biased working for a magazine that covers the grain handling industry, but I do think we have some of the best network of elevators and handlers across the country. And we also have like just a unique climate that we're able to produce so much soy and you don't really have to worry about all that drying, and other things that are both add cost and also risk damage. Oh, absolutely.
Speaker: We're able to produce more soybeans every year without increasing our land use. And that to me, that's a tremendous benefit, but also it speaks to the quality and the knowledge that goes into farming and the logistics and the transportation systems are able to increase every year.
Speaker: Yeah. So what are the big struggles we're seeing with soybean farmers? What do they want from their system that we're not quite managing yet? One of the greatest joys I have in my work is seeing U.S. soy farmer go to other parts of the world and connecting the world in this way. And when you have such a high-quality product and you're producing a sustainable, highly nutritious, highly consistent product, you want to see markets open.
Speaker: Very nice. And so one of the challenges, I think, is making sure the doors are open. And that speaks to our relationship building and our understanding of the global market. Sometimes a door closes in one place and opens in another. And what we would like to see is the market for U.S. soy, the doors being open.
Speaker: And this is something that is ah benefit when we're able to go and to influence government regulators, consumers, And to understand that the world benefits from u s soy feeding the animal production systems all over the world.
Speaker: So one of the challenges is making sure those doors are open. ah It's a process. That's what makes your association so important, makes the U.S. Brains Council so important, and so many others.
Speaker: is It's a long-term effort. It's not as simple as being like, hey, buy our beans. It takes a long time to build trust. Yeah. And trust is something we hear from ah are target audiences all the time, that they trust us as a source of information about science and the supply chain and the markets. And we think those relationships that we build all over the world, as important as the quality of the product.
Speaker: Like you said, product's there, the reliability is there. and That's really just getting that message out to the wall. Especially, we all know you can always buy the cheapest option. Well, pay me an now or pay me later. if he Exactly.
Speaker: that We see, and in fact, I want to speak to that because we see the damage that is done by feeding less quality soy in animal diets.
Speaker: The diets are more costly to meet the nutrient requirements, or the animals don't grow as well, or they're not as uniform when they get to the processing plant. And when you're looking at quality, price is always a factor, but you have to look at the value and the profitability of your operation. And that's where we really excel, is in demonstrating the superior quality brings payback to the animal producers. Yeah, and the safety we've managed to achieve along the entire value chain. The farmer all the way to when it gets to your export destination.
Speaker: So what are you guys working on in 2025? It's obviously of big year for soybeans, exports in general, of everything. What are your kind of goals going into 2025?
Speaker: There's a lot of things coming together in 2025. We're really focused on the profitability of our end user customers of U.S. soy. We're able to tie together sustainability with their profitability.
Speaker: For example, we're finding that poultry producers and aquaculture producers are labeling their products as having been fed with sustainable U.S. soy. This creates new markets for their profitability.
Speaker: products. It's very exciting to see, for example, aquaculture. This industry is transformational. There's very few industries that are transformational, to tell you the truth. We may think of things like artificial intelligence and big data, but that's been around since the 1950s and 1960s.
Speaker: In just the last 10 years, we've gone from a situation where most of the seafood was caught in the wild to now... We are feeding fish sustainably in systems that are profitable and reliable.
Speaker: And this is truly transformational. Now, most of the seafood that we consume are fed and produced in aquaculture production systems. And we're playing a big role in understanding not just the nutrition of animals that weren't really fed before and the production systems to produce soy-optimized feeding systems for the aquaculture production systems around the world.
Speaker: Yeah, aquavulture is one of those industries that I feel just is a no-brainer. There's probably people out there that don't like it or for whatever reason, but it is safer, sustainable for our oceans.
Speaker: My cat personally only likes real tuna-flavored stuff, so I had to look up, like, can I feed them this every day without giving them mercury poisoning? And that's something you could do because we have an aquavulture system. We're monitoring the health and the performance of the animals we feed, whether it's fish or chickens all over the world.
Speaker: And we're seeing the benefits to the animal health and performance because of feeding U.S. s soy in these systems. And is that a big area of growth you're expecting over the next couple of years? The aquaculture sector is a very big growth area.
Speaker: And I think the other is our understanding of the health benefits of soy in human and animal diets. Just wonderful compounds like isoflavones and anti-inflammatory and immune regulation are all benefiting from having soy in our diet as humans or in animals. And so we're really turning the science into profitability for our end users.
Speaker: Right. Anything else you would like to our readers to know about? I can't say too much how it I think it all comes back to the U.S. soy farmer. I think when people think of American agriculture, they may think of big industries and so forth. But really, the soy industry comes from family-owned farms that are passed down from generation to generation.
Speaker: More than 90% of soy comes from the family farm. And for them, sustainability is business sustainability. Practices of things like... variable application of inputs and with the other sustainability practices turn into value downstream.
Speaker: And so we're tying together the value across the supply chain. We're talking to growers. We're talking to our partners in logistics and the supply chain. to the traders, the nutritionists, the feed mill managers, the animal production systems.
Speaker: And we're asking them, what value is U.S. soy in your business? And we're hearing that it is a very important part of the profitability of their operation and that the consistency and the quality are what they expect and they see in U.S. soy.
Speaker: Sustainability is obviously that other big issue, the entire value chain. It has been nice to see more and more companies, government programs, all encouraging soy beef farmers to adopt sustainable practices, which is good for everybody. I never met producers, I don't care if my soil can last to the next generation.
Speaker: They all want to do it. They all want to do produce better. They just also want to be profitable. but The other thing I noticed in the past couple of years was I thought it was the consumers that were driving the sustainability movement. The consumers, of course, want their food to be produced in a sustainable manner.
Speaker: But when given the option to choose between two products, price does matter. And what we're finding is it's the financial institutions that are driving sustainability because they know that companies that adopt sustainable practices are applying practices that are going to keep their business profitable. It's going to be a good investment in that type of business.
Speaker: So sustainability and profitability really go handin hand in hand. That is the most important thing, which is the consistency of our product. If that is our selling point, and it's important that we make sure that our farms last and our environment is clean and good, and all these things are benefits to everyone.
Speaker: So it's really nice to see those programs being adopted and being put out there. Absolutely, Stephen. Awesome. If people want to know more information, want to get involved, want to learn more, where should they go? Look us up online at usec.org and you'll find a lot of information. Our customers say that we are a trusted source of knowledge in not just soy production, but in the animal production industries. And please come and visit our site or contact Any one of us ah around the world. Which I will also attest to. I love it when you guys send out a press release, our information.
Speaker: We eat it up at our magazine. So the entire industry should really be keeping an eye on what you guys are doing. I'm glad you do. Great working with you. You too. And thank you so much again for agreeing to talk to me today. i Really enjoyed it.
Speaker: I hope I can have you on again. I'd be happy to. kill Maybe in a quieter setting. The place is buzzing. And I love that actually about this event. It is awesome. All right. Thank you so much.
