Working Group Minutes / Soybean / 11 October 2017

Minutes

Soybean Working Group and the Sunflower, Soybean and Soybean Food Forum
combined meeting held on 11 October 2017 at the offices of the PRF and the Oilseeds Industry



  1. Opening

    Dr Jos de Kock opened the meeting with prayer.

  2. Welcome

    Mr Gerhard Scholtemeijer welcomed all to the combined meeting, and extended a special welcome to Ms Cloete of Russell Stone Protein, Ms Smallberger and Mr van Zyl of VKB, Mr Schoeman of FSOil and Mr Maree, a contractor of the PRF.

  3. Attendance

    Present

    Mnr GJH Scholtemeijer Chairperson
    Ms R Beukes DAFF
    Dr E Briedenhann PRF
    Ms S Cloete Russell Stone Protein
    Mr H Davies Eden Social Develop­ment Foundation
    Mr G de Beer PRF Contractor
    Dr J de Kock PRF
    Dr J Dreyer PRF
    Mr J du Plessis Producer: KwaZulu-Natal
    Mr J du Plessis Producer: Northwest
    Mr G Engelbrecht K2Agri
    Mr N Hawkins SAGIS
    Mr C Jacobs Producer: Free State
    Mr M Jansen van Rensburg Mpumalanga Depart­ment of Agriculture
    Mr C Joubert NAMC
    Mr G Keun PRF/OPDT CEO
    Dr K-J Leeuw ARC-AP
    Mr C Louw GrainSA
    Ms W Louw SAGL
    Mr E Maree PRF
    Prof F Meyer PRF
    Mr W Oosthuizen Producer: Free State
    Mr R Pholo GrainSA
    Ms T Pretorius AgChem
    Mr T Prinsloo ARC-GCI
    Ms M Purnell Agbiz Grain
    Mr G Roos Producer: Mpumalanga
    Ms N Rousseau Bayer
    Ms M Scheepers DAFF
    Mr F Schoeman FSOil
    Ms S Smalberger VKB
    Dr D Strydom GrainSA
    Mr A Theron PRF
    Mr D van der Westhuizen Producer: Mpumalanga
    Mr A van Vuuren NWK
    Ms R van Vuuren AgChem
    Mr WF van Wyk PRF Contractor
    Mr J van Zyl VKB
    Mr L Verhoef Agratech Trade
    Ms M du Preez PRF
    Ms E Harmse PRF Contractor

    Apologies

    Mr J Botma OAC
    Mr W Cronjé OAC
    Ms A de Beer ARC-GCI
    Dr L du Plessis PRF
    Mr W Engelbrecht
    Mr D Kritzinger Syngenta
    Dr S Maáli ARC-GCI
    Ms L Mellet NAMC
    Mr J Rankin Producer: North West
    Ms S Roberts Omnia
    Prof J van der Waals UP
    Mr K van Huyssteen SANSOR
    Mr R van Niekerk Agricol
  4. Personalia

    None reported.

  5. Confirmation of the agenda

    The agenda was accepted, with the addition of:

    • Item 13.1.7 – Weeg&Wen Yield Competition (Maize and Soybeans);
    • Item 13.1.8 – Rhizobium.
  6. Approval of minutes

    1. Minutes of the combined meeting of the Soybean Working Group and the Sunflower, Soybean and Soybean Food Forum held on 24 April 2017 and referral to website

      Resolution:

      1. That the minutes of the combined meeting of the Soybean Working Group and the Sunflower, Soybean and Soybean Food Forum held on 24 April 2017 be accepted as a true and fair reflection of that meeting, and that the minutes be referred to the PRF and Oilseeds Industry's websites for publication.

        Ms du Preez
        Marketing Committee

  7. Current soybean price: local and inter­national

    Dr Briedenhann reported on the current state of the national and international soybean and sunflower industry. He said only 36% of the United States (US) soybean crop had been harvested thus far, compared to the five year average of 43%. He mentioned that the weather had delayed plantings in Brazil, with a soybean crop of between 106 and 108 million ton being forecast for the coming season, in comparison to the 114 million tons produced during the previous season. He said these factors resulted in the market being as stable as it currently was, taking into consideration that the world was currently awash with grain and oilseeds.

    Dr Briedenhann noted that there was very little movement in terms of stocks to use ratios in the US, with no significant price movements being expected. He said the same applied to the global situation. He said prices have picked up slowly during the last few months, and were moving sideways at the moment.

    Dr Briedenhann said a total supply of approximately 1,4 million tons of soybeans would be available locally in 2017-2018, with a total consumption of 1,16 million ton being expected. He pointed out that this meant that 950 000 tons of soybeans had to be crushed over the year, which amounted to 79 000 tons per month. He said year to date only 71 000 tons had been crushed per month, although there had been months when numbers were much lower than usual. He noted that the country was not awash with soybean oilcake, and that the crushers were crushing as much volume as they could.

    Dr Briedenhann noted that soybeans were currently trading at export parity, with the result that roleplayers were carefully looking for an opportunity to export some soybeans.

    Dr Briedenhann reported that a stock of one million tons of sunflower was currently available, with a demand of 820 000 tons, which meant that 67 000 tons had to be crushed per month. He noted that year to date 64 000 tons of sunflower had been crushed per month. He said soybean and sunflower prices were more or less the same at present.

    Dr Briedenhann concluded by reporting that the soybean crush margin currently stood at R777 per ton, while the sunflower crush margin stood at R1 015 per ton.

    Mr Louw asked why the crushers were not crushing at optimum levels, taking into consideration the very positive crushing margins. He said it should be noted that sufficient crushing capacity was available, even though the Randfontein plant was down. Dr Briedenhann said the volume at the Wilmar plant in Randfontein was quite significant, which had made a big dent in capacity. He noted that the Willowton Isando plant, a potential soybean crushing plant, was presently crushing sunflower. He said in his view the dedicated soybean crushing plants were currently crushing at full capacity. He noted that breakdowns at plants had also made a big difference to the numbers.

    Mr Louw asked what the current dedicated soybean crushing capacity was. Dr Briedenhann replied that the capacity stood at 2,1 million tons. Mr Louw noted that this raised questions about the fact that soybeans were trading at export parity. He said the supply and demand situation did not make sense to him.

    Dr Briedenhann pointed out that the biggest local consumer of soybean oilcake had not yet made the switch to domestically produced soybean oilcake.

    Mr Jozeph du Plessis said producers were keen to determine what the capacity was for the expansion of sunflower and soybean production in the coming season. Dr Briedenhann noted that sufficient capacity was available to crush the entire crop away, even if production were to increase. He said he expected that the biggest local consumer of imported oilcake would switch to locally produced soybean oilcake in the near future, and that some of the dual plants would start to crush soybean. He noted that feed demand from the local poultry industry had decreased dramatically, due to the recent outbreaks of bird flu.

    The Chairperson pointed out that large volumes of soybean oilcake were still being imported. He said in his view there was definitely room for expansion.

    Cognisance was taken that the derived producer price for soybeans stood at R5 618 as at 5 October 2017.

  8. SAGIS

    Mr Hawkins presented an overview of the local and international supply and demand situation of soybeans and sunflower, and of the current situation with regard to producer deliveries, as measured against the official crop estimates data. He also provided information on local consumption figures, local and international prices, and imports and exports, among others. Cognisance was taken that this and other data were published on the SAGIS website.

    Dr Briedenhann said in his view there were no physical constraints on the demand for sunflower oilcake. He said any number of strategic exercises had confirmed that demand was price driven. He noted that sunflower oilcake typically was 65% of the value of soybean oilcake, and was down to 48% at the moment.

    The contents of the SAGIS Weekly Bulletin published on 5 October 2017 and of the Monthly Bulletin, published on 27 September 2017, were noted.

    Mr Louw asked whether it would be possible for SAGIS to provide data on the weekly producer deliveries of soybeans and sunflower. Mr Hawkins said SACOTA had recom­mended that such a service be initiated. He noted that the members of the Forum would have to make a recommendation in this regard to the Oil and Proteinseeds Development Trust, so that the Board of Trustees could approve the necessary funding for the service. He said he would draw up a budget in this regard for consideration by the Forum.

    Noted:

    1. That cognisance be taken that a budget for the provision of data on weekly producer deliveries of soybeans and sunflower will be submitted for the Forum's consideration.

      Mr Keun
      SSSF

  9. South African Supply and Demand Estimates Committee

    Mr Joubert said he had included information gleaned from Agricultural Market Information System (AMIS) reports in his presentation. He noted that the South African Supply and Demand Estimates Committee aimed to provide new information to the market, so as to enable users of the Committee's reports to also compile their own supply and demand estimates. He said it was important to note that the Committee did not deviate from the data supplied by the Crop Estimates Committee or SAGIS.

    Mr Joubert provided details on the composition of the Committee, of its aims and functions and of the various roleplayers to whom reports were submitted. He gave an overview of market movements, as reported by AMIS.

    Mr Joubert thanked the Maize Trust, the Oil and Proteinseeds Development Trust, the Winter Cereals Trust and the Sorghum Trust on behalf of the Committee for the funding that enabled the Committee to perform its functions.

    Cognisance was taken of the South African Supply and Demand Estimates Reports for April, May, June, July and August 2017.

  10. Weather and climate forecast

    It was noted that average to above average rainfall was expected in the summer rainfall areas in the coming production season.

  11. Crop estimates

    1. Latest crop estimates

      Cognisance was taken of the documents detailing the area planted estimate and seventh production forecast for summer crops for 2017; the revised area planted and first production forecast for winter cereals for the 2017 production season; the revised area estimate and second production forecast for winter cereals for the 2017 production season, and of the area planted and final production estimate for summer crops in 2017.

      Ms Scheepers presented on overview of the production estimates for soybeans and sunflower in the 2017 production season. She said 2017 had seen the biggest soybean crop ever produced in South Africa. She provided a graphic summary of soybean production from 1988 to 2017, and of the five and ten year averages attained. She also provided an overview of the average yields per hectare over time in the main soybean producing provinces; and of the soybean area planted under irrigation in the period 2010 to 2017.

      Ms Scheepers concluded the soybean overview by providing an image of the soybean:maize plantings ratio for the main soybean producing provinces for the period 2007 to 2017, which had more than doubled over time. She also presented a map of soybean plantings in the various magisterial districts in the Free State, Mpumalanga and North West.

      Ms Scheepers also provided a graphic summary of sunflower production from 1988 to 2017, and of the five and ten year averages attained. In addition she provided an overview of the average yields per hectare over time in the main sunflower producing provinces, and a map of sunflower plantings in the various magisterial districts in the Free State, Limpopo and North West.

      Ms Scheepers concluded the sunflower overview by outlining the ratio of groundnuts, sunflower and soybean plantings in 2007, 2012 and 2017.

  12. Producer matters

    1. KwaZulu-Natal

      1. General

        Mr Johann du Plessis reported that good rains had fallen over the whole of KwaZulu-Natal. He said there would definitely be a swing to soybeans in the coming season, and added that soybean seed had already been sold out.

    2. Mpumalanga and Gauteng

      1. General

        Mr van der Westhuizen reported that Mpumalanga had also received good rains. He said he expected a slight swing towards soybeans in the coming season.

        Mr van Wyk said any number of producers in the Highveld were already planting soybeans and maize in a 30:70 ratio, with soybean:maize ratios of 50:50 being a fairly common practice.

        Mr Van Wyk said the break-even point for Highveld maize was in excess of 6 tons per hectare, which stimulated soybean production. He noted that most of the seed companies had already run out of soybean seed.

    3. North West and Limpopo Province

      1. General

        Mr Jozeph du Plessis said he was sure that soybean production in the North West would once again increase in the coming production season. He reported that financing was a big concern in the western part of North West. He said he found it heartening that soybean production had increased constantly over the past six or seven difficult years. He noted that soybean production in the North West had increased from 200 hectares in 2012 to 18 000 in 2017. He said approximately 25 000 hectares would be planted to soybeans in the coming season.

        Mr Du Plessis continued by saying that much had been done to develop production systems so as to produce soybeans profitably in the difficult North Western conditions. He said in the past five years he had twice suffered losses with maize production, while he had not suffered any financial losses with soybean production in the past five years. He noted that the same tendency had been observed with sunflower production, with the result that he was very positive about future soybean and sunflower plantings in that province.

        Mr van Vuuren reported that there was a big drive to alternative crops in the NWK area, due to the weak profitability of maize. He noted that the break-even point in the production cost of maize was around 4,3 tons per hectare, which was way above the long-term average for that area. He said there was a growing interest in soybean production, especially to the Schweizer-Reneke side and under irrigation. He reported that interest in sunflower and cotton production was also on the increase.

    4. Free State

      1. General

        Mr Maree reported that prospects for soybean production in the Free State was looking very good, with the expectation being that soybean production in the Warden area would increase by 50%. He said in Villiers, Ascent and Vrede soybean plantings would also increase. He noted that producers tended to plant maize before soybeans, which in his view was a mistake.

    5. Eastern and Northern Cape and South Western Districts

      1. General

        No report back.

  13. Research

    1. Soybeans

      1. National cultivar trials 2017-2018

        Mr Prinsloo reported that all was proceeding according to plan as far as the 2017-2018 national cultivar trials were concerned. He said 35 cultivars would be evaluated at 21 localities.

        Mr Jozeph du Plessis said it was problematic that hardly any soybean cultivar trials were planted in the western parts of North West and the Free State. He said cultivar choice was of critical importance for successful soybean production.

        The Chairperson mentioned that the Oilseeds industry was aware of the problem. He said the matter would be investigated, and feedback given at a future meeting. He asked all affected parties to voice their concerns at the annual meeting when cultivar trails are discussed at Potchefstroom, normally during September.

        Noted:

        1. That feedback is awaited on the planting of national soybean cultivar trials in the western parts of North West and the Free State.

          Chairperson
          Oilseeds Advisory Committee

      2. Soybean rust

        No report back.

      3. Soybean web study

        Cognisance was taken of the information on Sudden Death Syndrome, and of the various options available for the control of the disease; of the University of Georgia's programme for resistance breeding for root-knot nematodes; of Dr Hulke's work on abiotic stress resistance, and of the information on the use of genomic selection to optimise prediction of Sclerotinia infection, as well as other information extracted from the latest soybean web study.

      4. Sclerotinia

        The Chairperson reported that Dr Underwood's lectures at the Sclerotinia Information Days, as organised and sponsored by GrainSA and Bayer, had been very well received.

        Dr Briedenhann said in his view it was worthwhile presenting information days such as these, and to invite experts like Dr Underwood, who also had practical experience, to enlighten local audiences. He added that he found it interesting that specific cultivars were less prone to the disease.

        Mr van Vuuren reported that he had attended the Sclerotinia Information Day at Bothaville. He said although useful information was made available, the problem was that solutions had yet to be identified. He noted that good results had been achieved with Bayer's Contans, but added that he considered the associated cost of R1 000 per hectare to be prohibitive.

        Mr Theron suggested that SANSOR be officially requested to advise its members to label Sclerotinia-resistant cultivars accordingly.

        Mr van Wyk said he was not aware of a locally available implement with which Contans could be worked into the soil at a depth of 3cm, as recommended. He noted that the cost of R1 000 per hectare, that Mr van Vuuren had referred to, was more than affordable for producers on the Highveld, as the damage caused by Sclerotinia on the Highveld would be in excess of R1 000 per hectare.

        Dr de Kock reported that Dr Underwood had stated that Sclerotinia infection of ≤20% would not necessarily result in yield loss. He said this should be investigated locally.

        Resolved:

        1. That SANSOR be officially requested to advise its members to label Sclerotinia-resistant cultivars accordingly.

          Mr Keun
          Soybean Working Group
          Technology Committee

      5. Root-knot nematodes

        Cognisance was taken of the various seed companies' responses to the Soybean Working Group's request to them to provide information on their cultivars with resistance to root-knot nematodes.

      6. South African Cultivar and Technology Agency (SACTA)

        The Chairperson reported that feedback was being awaited, after the Forum's application for endpoint royalties on soybeans had been submitted to the National Agricultural Marketing Council (NAMC).

        Resolved:

        1. That feedback is being awaited, after the Forum's application for endpoint royalties on soybeans had been submitted to the National Agricultural Marketing Council (NAMC).

          Mr Keun
          Soybean Working Group
          SSSF

      7. Weeg&Wen Yield Competition (Maize and Soybeans)

        Mr Louw reported that sunflower would be included in the new production season's yield competition. He said the necessary planning had been done, and added that there would be a more equitable grouping of the various localities.

        Dr de Kock said Mr Koos Uys from Bronkhorstspruit had won the previous season's yield competition for soybeans produced under irrigation with an average yield of 6,25 tons per hectare, while Mr Michael Allen from Middelburg had won the eastern competition with an average yield of 4,858 tons per hectare, Mr Bernard Rabe from Fochville had won the western competition with an average yield of 4,4 tons per hectare and Mr Kobus Botha from Bergville had won the KwaZulu-Natal leg of the competition with an average yield of 4,7326 tons per hectare.

        Dr Strydom said GrainSA would assist DuPontPioneer in marketing the competition to producers, and in ensuring that winning producers' practices be reported in the media.

        Resolved:

        1. It was noted that GrainSA would assist DuPontPioneer in marketing the competition to producers, and in ensuring that winning producers' practices be reported in the media.

          Dr D Strydom

      8. Rhizobium

        Mr Louw reported that producers who were new to soybean production were seemingly not totally familiar with best practice guidelines as far as the application of rhizobium was concerned.

        Mr Jozeph du Plessis noted that there were new entrants to the inoculants market as well. He said some producers were not well informed, and suggested that an informative article be published in the Landbouweekblad or in SAGrain. The Chairperson said this would be referred to the Technology Committee of the PRF and the Research Priority Committee of the OAC.

        Mr Louw said GrainSA had raised the matter with the Registrar. He noted that the revised Fertiliser Act would include guidelines on inoculants.

        Resolved:

        1. That an informative article on best practice guidelines as far as the application of rhizobium on soybeans be published in the Landbouweekblad or in SAGrain.

          Dr Briedenhann
          Technology Committee
          Research Priority Committee

    2. Sunflower

      1. Sunflower Value Chain study

        Mr Keun reported that the Oilseeds Industry had addressed all the recommendations of the Sunflower Value Chain Study. The Chairperson ruled that the matter be considered as closed.

  14. Seed

    1. Snippets

      Cognisance was taken of the information included as snippets on the seed industry.

      The Chairman enquired about the producers' interest in non-GM Soybean seed.

    2. Non-GM seed

      Mr Davies said the problem was that producers were not interested in producing non-GM soybeans, as they were not paid a premium for their deliveries.

    3. Other

      No feedback.

  15. Technology transfer

    1. Information Days 2018

      Cognisance was taken that the NAMPO Harvest Day would take place from 15 to 18 May 2018 in Bothaville.

    2. Videos

      Cognisance was taken of the list of videos that had been published on the PRF's website.

    3. Oilseeds Focus

      Cognisance was taken of the September 2017 edition of the Oilseeds Focus.

  16. Soybean Food Association

    The Chairperson reported that Prof Hettie Schönfeldt of the University of Pretoria had been granted funding to conduct a survey on the current state of the South African soybean food market. He said the results of the survey were being awaited.

  17. Other matters

    1. News reports

      Cognisance were taken of the news reports included in Annexure L.

    2. Articles

      Cognisance were taken of the articles included in Annexure M.

    3. Presentation on weed control: Dr Jan Dreyer

      Cognisance was taken of the copy of Dr Dreyer's presentation on weed control in soybean production.

    4. Income and cost budgets

      Cognisance was taken of Mr van der Westhuizen of the Bureau for Food and Agricultural Policy's (BFAP) questions on the percentage allocation of the cost budget for soybeans to certified seed purchases and insurance costs.

      The Chairperson noted that the cost of using 100% certified seed would amount to R700 per hectare. He said the PRF had suggested that the soybean cost budgets be based on a 50% use of certified seed.

      He invited comments on insurance costs to provide for hail damage. Mr van Vuuren said in his view insurance costs of R1 260 per hectare would be excessive. He noted that the insurance costs should be calculated as a percentage of the expected price that would be paid for soybeans.

      Mr Johann du Plessis said insurance costs varied from region to region.

      Mr Jozeph du Plessis reported that GrainSA's Ms Fourie received data on insurance costs for the whole of the country, so as to enable her to compile production budgets. He suggested that BFAP contact Ms Fourie in this regard.

      Dr Strydom noted that Mr van der Westhuizen had consulted with Ms Fourie on the matter. He said the matter was in hand.

    5. Sunflower Highlights

      Cognisance were taken of the various editions of the U.S.A. Sunflower Highlights, included in Annexure P.

    6. LEAF Services

      Mr Keun reported that representatives of the grain and oilseeds industries had successfully negotiated with the Department of Agriculture, Forestry and Fisheries (DAFF) with regard to the LEAF Services issue. He said LEAF Services is to deliver a presentation on the proposed standard procedures on 23 October 2017.

    7. Presentation: Planting date and row width trials in the Eastern Free State, Mr J van Zyl, VKB

      Mr van Zyl delivered a presentation on the planting date and row width trials in the Eastern Free State. He said VKB considered sustainable soybean yields in that area to be important, due to their soybean oil crushing plant in Villiers as well as their animal feed factory.

      Mr van Zyl outlined the aims of the project, as well as the procedures followed and the results achieved thus far. He said it was already possible to make solid recommendations, even though the project was still in its early stages. He concluded by providing an overview of the way he intended to take the project forward.

      The Chairperson thanked Mr van Zyl for his presentation.

    8. World Soybean Research Conference (WSRC) X, Savannah, Georgia

      The Chairperson reported that the WSRC X had unfortunately been cancelled, due to the dangers posed by Typhoon Irma.

    9. SAGL Crop Protection Division: accreditation status

      Cognisance was taken that SAGL's Crop Protection Division had been awarded accreditation status by SANAS.

  18. Election of office bearers

    1. Election of Vice Chairperson

      Mr Keun said the Chairperson and Vice Chairperson were elected in alternate years, and were elected for a term of two years. He said the Chairperson had been elected the previous year. He called for nominations for the position of Vice Chairperson.

      Mr Jan Botma was unanimously re-elected as Chairperson of the Sunflower, Soybean and Soyfood Forum.

      Resolved:

      1. That Mr Jan Botma be unanimously re-elected as Vice Chairperson of the Sunflower, Soybean and Soybean Food Forum for the 2017-2019 term.

        Mr Botma
        SSSF

  19. Date of next meeting

    The next meeting will be held on 1 February 2018.

  20. Adjournment

    The Chairperson said he was pleased to honour certain individuals for their contributions to the soybean industry, the first of those being Mr Erich Maree, a valued PRF-contractor, who planned to retire at the end of February 2018; Messrs de Beer and van Wyk, for the part they had played in the elite soybean trials; Mmes Beukes and Scheepers, for their valuable contributions in promoting the aims of the Oilseeds Industry; and Dr Jan Dreyer, for his valuable contribution in promoting the aims of the PRF.

    The Chairperson thanked the members for their participation and inputs delivered. There being no further matters for discussion, the meeting was adjourned at 13:30.