Soya bean prices on the Chicago Board of Trade have increased by more than $3/bushel (€90/t) since last summer and look set to rise a further $2/bu to over $13/bu (€400/t) in the coming months. Prices for soya bean meal, one of the two main products produced from soya beans along with soy oil, have increased by over €100/t ex Irish port in the past six months. An indication of the price movements here is shown in Figure 1.

The sustainability of importing soya bean-based products and maize has often been questioned. Ireland as a nation cannot feed its national herd from the small area of tillage now being grown, but should that extra feed be coming from halfway across the world, where production regulations are not as tight as in the EU?

It is an 11,000km sea trip from Buenos Aires to Dublin and much longer when you add in the land transport either side. There is also the fact that a ship does not travel in a straight line and most big ships will not come direct. And Mato Grosso in Brazil is about 9,000km away from here.

The escalation in soya bean prices due to the impact of weather, especially dryness, and increased demand due to the rebuilding of the pig industry in China may be forcing those importing or feeding soya bean-based products to rethink their plans.

Homegrown protein

The price hike should turn the focus to homegrown protein. Numerous calls have been made from the tillage sector for the expansion of the Protein Aid Scheme and for an increase in funding. Red clover and alfalfa have been suggested as an addition to the scheme as a forage element as they are leguminous crops, produce high-protein forage and reduce the overall nitrogen requirement for feed and forage production.

Soya beans were ineligible in the past because they were not a commercial option when the scheme was being constructed but they have since been trialled by some grain merchants and co-ops and should be included in the revamp.

Teagasc has said there is potential for the area planted to field beans to double as farmers put greater emphasis on rotations for soil health and grassweed control.

The protein scheme has worked. In 2014 just 3,500ha of beans and peas were planted in this country. In 2020 this figure was at its highest at almost 13,750ha.

Incentive

As in any enterprise, the incentive needs to be there to encourage acres to go to protein crops and to encourage farmers to plant. The budget, which was set at €3m since the scheme was established, will need to be increased if more farmers are to avail of it. As it is currently constructed, payment would decrease if more farmers grow more acres as all payments must come from the same fixed pot.

Likewise, buyers of protein will need to come out with a strong contract price in the coming weeks if they are to drive an increase in the area planted. In previous years, many merchants in the sector have supported farmers by offering strong contract prices before planting begins.

For many years, insufficient quantity was a disincentive to bean use by feed millers. This has been improved slightly but the supply of native protein falls well short of the current imports of close to 500,000t of soya bean meal and much more than that of mid-protein feeds like rape meal, corn distillers, soya hulls, etc.

EU policy

While lack of native protein in particular is acute on this island, it is also a serious concern across the EU. There have been many efforts in the past to address this, but they failed to gain serious traction. We must wonder if the current efforts to address the EU’s protein deficiency will be more successful.

There seems to be a stronger intent this time with a much broader base of technologies being assessed. However, little will happen unless there is follow-through on the vast amount of research currently being conducted.

We must also wonder about the possibility of growing more soya beans within the EU. A number of countries currently grow soya beans, right up to and including Britain. Efforts here have not been sufficiently successful in the last three difficult years, but this does not have to be the experience in other countries like France, Spain, Portugal, Italy, Romania etc.

The large footprint of EU territory must have the capability to produce a lot more of its soya protein needs if it is incentivised in a way that makes that crop profitable.

Side benefits

Indirectly the Irish scheme has contributed to better crop rotations, improved soil health and structure and a reduction in nitrogen requirements to both crops and nationally. It could bring the same benefits to other EU states. Healthier soils can also mean healthier crops and often a reduction in fungicide requirement.

December usually hails the announcement of the Protein Aid Scheme budget for the year gone by and the finalisation of the protein payment. A commitment on budget for next year, as well as further investment into the scheme and expansion of the cropping list, will be vital if the scheme is to continue to grow and improve. If the incentive and the budget is not there for the 2021 season the area planted to protein crops will not increase substantially.