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Overview
• Where are we at now?
• How did we get here?
• What opportunities exist to change this?
• How can we make the future look different?
Drivers for Ontario production
0
5
10
15
1942 1952 1962 1972 1982 1992 2002
Val
ue ($
/bu)
05001000150020002500
Vol
ume
(1,0
00
acre
s)
$/bu Acres harvested
Example of value sharing
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
1996 1998 2000 2002 2004
Pri
ce/l
b (
U.S
. $)
Retail
Wholesale
Farm
Swine value chain (US)
Farm soybean profit versus export margin.
-$2.00
-$1.00
$0.00
$1.00
$2.00
$3.00
$4.00
1988 1993 1998 2003
Val
ue/
bu
Farm profit
Export margin
Farm profit versus crushing margin.
-$20.00
$0.00
$20.00
$40.00
$60.00
$80.00
$100.00
1990 1995 2000 2005
Farm profit
Crush margin
Future projections
• Price will stay stable to improve– Argentina close to maxed out– Brazil poised for additional growth– U.S. reduced production– China is the one to watch
Why are industrial markets exciting?
1. Increased demand for soybeans
2. A new opportunity for value chain management.
3. Greater market diversity leads to greater market stability for producers.
Food is not the best growth opportunity for agriculture.
$0$5
$10$15$20$25
GDP ($B)
Industrial sector value in Ontario.
0
100,000
200,000
300,000
400,000
2002 2005 2008 2011 2014 2017 2020
Ac
res
of
so
yb
ea
nPotential bio-diesel demand for Canadian soybeans.
NPV = $21,655,050
Soy wax candles
Waxproducer
6,000 acres of soybean
Candle company
Candlecompany
Candlecompany
CandleCompany
Moving up the value chain.
Soybeans
Protein
Oil
Carbohydrates
Soy meal
Soy food
Salad oil
Plastics
Ethanol
Plastics
Two ways to move up the chain.
Varieties grown for industry
Farmers involvedin processing
-Varieties with altered profiles-Less protein/higher oil/higher yield
-Lower price/bu, Higher value/acre
Summary• New market opportunities are
coming.
• These will create more value by increasing demand.
• To gain greater value requires movement up the value chain.