The Super WalMart near the hotel where we stayed during the Mexico leg of the United Soybean Board See for Yourself Program was chock full of soy products. A quick tour of the Quadalajara, Jalisco mega-store proved successful for the United States soybean farmers hoping to catch a glimpse of products for sale containing American soybeans.
David Williams farms with his father and nephew near the center of the Lower Peninsula of Michigan. As a participant in the 2010 United Soybean See for Yourself Program, Williams said the experience gave him a better understanding that his checkoff dollars are being put to good use, helping promote U.S. soybeans both domestically and abroad.
The highlight of the program for Williams, like many others, was the visit to PROAN, an enormous animal agricultural enterprise in the state of Jalisco, Mexico.
“I was exceptionally impressed with how much U.S. product that they use,” said Williams. “They get the majority of their soybean meal from the United States. They use DDG’s from the United States. A lot of their feed materials come from the United States. They are an excellent customer for us. They bring it in train loads. That was really impressive.”
Williams looks forward to relating some of his experiences with other Michigan soybean farmers.
“I’ll tell them how much the USB is working for us and our checkoff dollars are working for us. If we didn’t have these people in Latin America and Mexico in particular. . .we wouldn’t have much of an export market. And it’s just extremely valuable because we cannot in the United States utilize all the soybeans we produce. We have to export our beans and that helps our markets and keeps the price at something that is sustainable for U.S. farmers.”
The highlight of the United Soybean Board See for Yourself Program for Brian Cassady was the visit to PROAN, one of the largest animal agriculture enterprises in Latin America.
Cassady’s family raises corn, soybeans and beef cattle in central Iowa. Being selected to participate in this program gave him the opportunity to see how soybean checkoff dollars are invested in Mexico, something he says he knew nothing about prior to this experience.
Cassady will tell farmers back in his home area that they should see how the checkoff is working here. “It’s something they ought to come see if they could and they would be amazed at where their soybeans are going and how they are being used all over the world.”
He believes the soybean checkoff is working in Mexico.
“I would say it’s working really well. There is a good market here from the way it looks and sounds.”
Bert Greenwalt farms with his brother and father in eastern Arkansas. As a participant in the United Soybean Board’s See for Yourself program, he learned a great deal about the scope of the USB.
“I knew it was a national organization with an important job but when you meet the staff and directors of the program you see how large the board is and the number of committees and the enthusiasm come to their work with is most impressive.”
Greenwalt said the culture of Mexico was fascinating and the sophistication of animal agriculture, impressive.
“The industrialization of the animal agriculture in this country, and I know we have only seen a select part of it, but you can tell this is just the beginning of more and more development in this country. It’s very advanced, very modern, very intensively managed, and it’s certainly an important customer of ours that we’ll have to pay attention to.”
John Becherer, United Soybean Board CEO is pleased with the success of the USB See for Yourself program. In its third year, the interest in the program is on the rise.
“You know what’s interesting is the first year we put this program on we actually didn’t even have ten applicants if you can believe that for the program,” said Becherer. “Last year we had probably had fifteen or so applicants. This year, I don’t know even really know what the numbers were, but it was big. So, there are a lot of people who now are recognizing that this type of program is available and I think what it speaks to is the fact that people understand that they are being asked to do something. This is not a junket. We cover a lot of things in a few days and we are really looking for the opportunity for these people to evaluate our program. We tell them that upfront and we tell them that throughout the program. We do take it a little easier than we would with the veteran people on the board who travel, but it’s still a really good program.”
The greatest benefit of the program, explained Becherer, is the ability for participants to do see for themselves.
“They are able to touch and feel and see what these programs are doing and when we do these programs we want to make sure that they are impacting and they hear the economics. They hear what this is doing in the market place. They are able to see it firsthand. I think it gives a touch and a feel and a real understanding they can take back to their producers and say ‘hey you know here are some of the things that are going on.’
Becherer sees great values in the relationships USB representatives are building in Mexico. “Relationships that we build with the people in this country to market the soybeans to and the relationships that we have within the soybean industry and the grower organizations are very important. State and National, Checkoff and Association, but also the relationships we have with the people that are actually exporting the soybeans. It is critically important that we work hand in glove, lock step with these people.”
Becherer said that many farmers take their soybeans to the elevator and that, as far as they are concerned, is the end of the marketing.
“The reality from our perspective, working for the farmers, we need to be working with the exporters who are moving these beans all over the world,” he explained.
Becherer is excited about the opportunities presented by the market possibilities in Mexico.
“What gets me excited it two things and they are on both ends of the spectrum,” he said. “One is the sophistication of the market here and the productions systems. We were at an organization called PROAN yesterday. They have a state of the art feed facility. It’s second to none in the world that I have seen. They have the very most scientific egg production place and they literally brand every egg that leaves that place. We don’t do that in the U.S. I have seen a few brands. So, on one end of the spectrum is that this country truly has the mechanism, the capital investment to truly move forward and produce products at a lower and lower price creating more and more value therefore increasing soybean exports.”
“The other side of the spectrum is this country has many people who are not at the upper level of the economic scale,” said Becherer. “So, the opportunity for this country to grow and become an even better partner and an even greater consumer of soybeans is quite dramatic. When you look at the fact that there are many direct protein soy foods – textured soy protein foods that are marketed in the grocery stores in this country- it really speaks to the fact that these people are using more and more of these products everyday and at the same time as their disposable income increases they’re moving to fish and other products. They use more and more soybeans for a less and less weight gain so it is less efficient. Therefore, soybeans farmers in the U.S. are selling more soybeans into these countries to make the protein products the consumers have.”
Becherer said USB asks participants to evaluate the programs in Mexico while they’re here. Feedback has been good.
“Certainly as we have talked to people and learned how they have gone back to their own communities and participated in their communities, they have indicated that they have changed the minds of some people,” he explained. “They have really given a face to the checkoff which I think it important. It is always difficult to have the kind of direct report with every producer. There are 589,182 of them in the U.S. which makes it a difficult process. But, I think the other thing that’s happened is some of these people who were on this tour are now becoming involved in their state organizations and that’s a pathway obviously to the national organization and to be appointed to the national board. I think those are great success stories. We also invite the participants of this program to our December meeting and every other year we have an industry wide planning meeting and we invite 300 of the leadership from both industry, processing, seed and technology industry, consumer use, and end users so they will be a part of a group of about 300 people who come together every two years to look at what the near term needs of the industry are. I think that’s a really great thing. The interesting thing is these are really interesting and exciting and diverse people and that’s the beauty in this. They come to this with their own preconceived ideas, from their own background, and they are able to see this program and look through it with their own eyes with their own history, with their own background and be able to come to conclusions based on that and I think that is wonderful.”
Becherer has traveled with the program each of its three years and has seen dramatic changes in Mexico. He has seen improved efficiencies in the organizations and industry visits.
“They are at the top of the industry in terms of having very clean, very safe, high quality food products that they are producing and it’s obvious that they are striving to reach new, higher plateaus all the time. In addition these organizations that we are working with and sending a lot of soybeans and soybean meal to from the U.S. are also expanding their operations and expanding into different endeavors. That says a lot about the success and potential for future success. It’s really exciting. It’s kind of one of those bonuses you acquire when you are able to do this program three years in a row.”
Sharon Covert, United Soybean Board director from north central Illinois, was one of four USB directors traveling with the United Soybean Board’s “See for Yourself” program.
Covert was pleased with what the participants had the opportunity to see and do as part of the program. “I think a lot of them didn’t have an idea about what the United Soybean Board spends their funds on, and it’s really their funds. They learned a little bit about where their money is going.”
As sub-committee chair of the Aquaculture Committee for USB, Covert is interested in working with aquaculture on the international market.
“I was very interested in the tilapia farm we visited because I hadn’t seen any of the Mexican projects that we’ve been working with and it was very interesting to see how large of an operation it is and how much it’s growing and that they are using all U.S. soybeans in the feed that they are using from the very little fish to the large fish that they are growing and selling into the market. It was also interesting to hear that even though they are expanding quite rapidly, they are not keeping up with the demand that they have and they aren’t able to fill all of the orders they have.”
She sees great opportunity for U.S. soybean farmers in Mexico.
“We visited a very large modern farm here in Mexico, PROAN. They are just a premier farming operation and buy a lot of U.S. soybeans and soybean meal from us and getting train loads of it at once. So, they are well able to handle a lot of soybeans. So, that was very interesting but we visited a variety of different things and I think not only did I learn something from it, I know the “See for Yourself” people also had an opportunity to learn about where their checkoff money is going to build a market for them.”
Covert said it was a great opportunity for her to learn as well as for the ten selected participants to learn. “I think any time you can see an operation where your checkoff dollars are really being spent to expand the markets, our foreign markets are so important to us. More than fifty percent of our soybeans are sold, soybean meal or soybean oil product are used in our international markets. Mexico is our neighbor to the south and they are our customer to lose. We need to take good care of our market in Mexico and we also need to make sure we are giving them what they want and I think we are doing that at the present time. We have great staff down here that are working with the people and that’s what we’re trying to do. Just tell them thank you and let them know that soybean growers in the United States are interested in their business and we want to deliver a product to them that they want.”
Covert is pleased with the work being done by staff representing the U.S. soybean industry in foreign markets.
“The staff that we have working for us around the world is great people, very knowledgeable about soybeans,” said Covert. “I think that they are the backbone of our business. They are the ones in contact with our customers, not only in Mexico but all over the world. We have a really great staff. They’re the people who have our face to our customers and it’s very good to know and I think we owe a lot to them. The United Soybean Board has been very supportive of them and that’s important too. The participants in this week’s tour to Mexico got to really see how this works.”
On our final full day in Mexico, participants in the United Soybean Board’s See for Yourself Program boarded the bus and headed to the town of Jamay near Lake Chapala, about 70 miles from Guadalajara. We visited Alfredo Molina and his son, Alfredo, Jr. and their families on their farm where they produce fish.
The mid-sized operation produces markets and delivers live fish throughout the state of Jalisco and in some other states to local markets where the fish is purchased for households and to restaurants. They also deliver fry (baby fish) to some other fish farms.
Fish that is to be eaten is sold three ways in Jalisco: whole (gutted), filleted, or live. As Alfredo, Jr. explained through an interpreter, “The fresh fish is an added value.”
This has been a successful operation, given improved management, local market focus and the fact that Mr. Alfredo Molina and Alfredo, Jr. manage the farm.
They own a second farm near the coast of the state of Jalisco and are in the process of expanding the Jamay farm we visited.
For 5 -6 years, the Jamay farm has been working intensively in aquaculture. Workers say it is a very clean place to work. There are 30 people working at this farm.
The farm includes more than twenty acres of air ponds for growing catfish, but when the decision was made to raise tilapia, the Molina family installed tanks appropriate for tilapia.
The Molina family received some funding through government programs to add on to their operation. They have also added several long, narrow ponds outside in a poly culture, where catfish and tilapia are grown in the same pond. Tilapia eat the floating feed on top of the water and the bottom-feeding catfish clean up any of the feed that sinks to the bottom.
The Molinas have their own breeding area where they have the capacity to produce 1 ½ million fries each month.
Tilapia males carry the fertilized eggs in their mouths. The farmers extract the egg and put them in a sort of “incubator.” When the eggs hatch (a baby fish is a fry) they drop into tanks.
There is an area to raise the breeders, am area for “pre-growth” and another for finishing the fish.
The finishing ponds for the tilapia are 10 feet deep. There are 20,000 fish per pond. At this stage, death loss is about 3%. Throughout the entire cycle, from hatch to finish, the death loss is about 20%.
The finished fish weight 500-600 grams each, or just a little over a pound.
Looking out over the outdoor ponds, we saw nets that we were told keep snakes, birds and people out.
Enrique Bourguetts works for the state of Jalisco, Mexico, assisting the aquaculture industry and ensuring that best management practices are met on these farms and that the industry is of high quality. He explained his position as “working between government and the private sector.” He joined the USB See for Yourself Program during our visit to the Molina farm.
Bourguetts said Alfredo Molina, Sr. taught aquaculture at a local high school.
“And then a class on aquaculture engineering and then he started working with aquaculture. . .he has to be more than thirty years working in here,” said Bourguetts. “When he first started his family, he introduced all his sons – he has three sons – and he has all of them working here.”
Alfredo, Jr. a biologist. His brother is an economist. Both are involved in the family fish farm.
Bourguetts told me that Alfredo, Sr. rented some land in this area because it is well suited for aquaculture. “The other part,” explained Bourguetts, “is they have a lot of the people in this area that are very used to eating a lot of fish weekly because we have the Chapala Lake nearby.”
Bourguetts said that aquaculture is in its infancy as an industry, but is growing in the state of Jalisco with about 200- 250 mid-sized farms.
The Silver Cup brand of feed used is 40-50% soybean meal. The specific amount of soybean meal in the ration varies depending upon the size of the fish. Bourguetts said, “Most of the feed makers work with elements imported from the United States and soy is one of them and the most important.”
Enrique Bourguetts told me fish farming is a lucrative business in this area.
“The cost are producing one kilo of tilapia if you are kind of efficient and medium size you have to spend 15-20 pesos. They sell one kilo of fish for 40-45 pesos. So, it’s more than double. It’s a lot of revenue.”
The weather in the state of Jalisco is about as good as it gets for aquaculture. According to Bourguetts, “Jalisco is in a geographical area where the two weathers mix. We have fish from cold water like trout and fish like the warm weather tilapia. And in between them is the catfish. Catfish is the state fish in Jalisco so we have a lot of potential for catfish and we have a lot of potential from shrimp in our coastal areas, fresh water prawns, black bass, tilapia, carp and fresh water lobster. We have a really good potential for all of these here in Jalisco.”
The demand for fish is high in the area and growing. None of the fish from this farm or other farms in Jalisco is exported to other countries because Bourguetts explained, “Not yet because they don’t make enough. All of it is consumed here.”
Bill Brandt, Regional Director for Latin American and Caribbean with the United States Soybean Checkoff said the United Soybean Board’s See for Yourself Program is sort of a “Whitman’s Sampler” of soybean checkoff efforts in the region.
Brandt told me the U.S. Soybean Checkoff is successful in this part of the world. “It is the United States’ second largest market for soybeans and the largest market for soybean meal and soybean oil,” he said. “A lot of that is due to the proximity of the United States but also because of our market development efforts here to familiarize the producers, the importers about the quality and value of U.S. soy.”
Brandt said relationships are very important in many of those global markets where U.S. soybean producers are trying to get products sold.
“Absolutely,” said Brandt. “We are accessible 24-7. We’re in the neighborhood and when they have a problem, the first people they call are us. Or if they have a technical question or if they simply need more information on how to produce a better feed formulation, oil processing or a new food product, we’re here. That makes all the difference in the world.”
Price is the number one concern for buyers in this market. Availability and timeliness are also very important to these buyers.
“This is out market to lose,” said Brandt. “Argentina has oil. Brazil has soybeans. They’re going to continue to expand their production. They are going to continue to look for new markets. And we’re going to have to stay on top of it. Again, being in the market, being with them in the market makes all the difference up to a certain price. Obviously if for whatever reason U.S. market prices are considerably higher, they will start to look otherwise. But, for the time being given our competition, given the new varieties of soybeans and the quality of our soybean and soybean products such as soybean meal and some of the other soy products, we’re still ahead of the game. We’re still making advances. There is a lot more room to grow in this region.”
U.S. Soybean has many projects underway in this market.
“The meat and potatoes of our marketing activities,” said Brandt, “continue to be our animal utilization programs. These have been successful and will continue to grow but I think it’s important to recognize that we need to stay diverse and that we need to continue to promote our high quality soybean oil with those markets that we have not really penetrated yet for example the hotel, restaurant and institution sector of the market. There is tremendous growth potential there. We also have soy products. That’s a little downstream from the farm gate but if twelve to fifteen new products are being developed every year we need to be looking at changing taste and preferences. It’s a long term investment but these are high value products. These have also been very successful.”
Another area of great opportunity in Mexico is aquaculture, where production has grown 165% over the last five years.
“They are growing and producing and needing everything that they produce. We are getting inclusion rates up to thirty to forty percent with U.S. soybean meal.”
Brandt encourages farmers to come to Mexico and see for themselves the many successful efforts underway to promote and sell U.S. soybeans in Latin America.
The fifth stop on the The United Soybean Board See for Yourself Program’s visit to PROAN, an enormous agricultural enterprise located in the northeastern part of the state of Jalisco, Mexico, was at the group’s dairy operation.
Genetics and selection, according to management at PROAN’s dairy farm, are key to success. Every effort is made to keep the 5,000 head dairy operation as sanitary as possible. The cows are artificially inseminated and calve at two years of age and from then on, one calf every year.
There are 2,307 cows for milking purposes. Cows are milked three times per day, twenty-four hours per day, with production of 75,000 liters of milk per day. The milking process is automated, with a fifty-rour stall rotary parlor for milking the Holstein cows. All the milkers wear gloves. The cows are dipped before and after milking and wiped with cloth towels.
The milk is pasteurized and shipped to both Dannon and Alpura processing plants.
Cows at PROAN are milked for 7 years.
Cows are fed corn sileage and alfalfa.
The size, efficiencies, biosecurity practices and composting practices at PROAN are impressive.
There simply weren’t enough hours in the day to see the entire PROAN operation. We saw a presentation on the swine operation but did not visit it. We were told that PROAN’s swine operation consists of 45,000 sows, with an average of 22 pigs per sow per year. One unit, according to our hosts, had a 26-pig average.
It is interesting the extra steps PROAN is taking to be sanitary and biosecure although in Mexico, many are not legally necessary. To say PROAN is an impressive operation would be an understatement. Many of the participants in the USB See for Yourself Program marveled at the attention to detail and sheer size and scope of the operation.
PROAN is distinguished for its efficient transportation system, which is known as “JUST-IN-TIME.” Close attention is paid to logistics and specialized equipment to ensure prompt delivery of products. PROAN’s central location makes marketing products in 26 states of Mexico with delivery time of only 24 hours doable.
Our final stop on the PROAN visit was at a beautiful hacienda where our hosts fed and entertained us well.
The main course? Your choice of pigeon, chicken or lamb taco. Most tried some of each. Our hosts treated us to some traditional Mexican candies to end the meal – and day – on a high note!
The mariachi band played lovely music while we enjoyed our meal and conversation.
The fourth stop on the USB See for Yourself Program visit to Proteina Animal (PROAN), one of the largest ag enterprises in Mexico, was the group’s railroad terminal. Our hosts said they receive 3 to 4 trains per week, bringing soybean meal, DDGs and other feedgrains.
The PROAN terminal is efficient, with the ability to unload 100 cars in 10 hours. At the time we were visiting, they were expecting a train with 80 cars of DDGs from the United States and 20 cars of Mexican-grown sorghum from Guadalajara.
On site are 6 bins with 60,000 metric ton holding capacity.
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