Apr 08, 2010
Brazilian Soybean Industry Launches Soja Plus Brand
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
Several agricultural organizations have joined forces in Brazil to launch a new program of sustainable soybean production called Soja Plus. The goal of this new program is to produce soybeans in sustainable manner that meets social and environmental goals in addition to being economically viable. Joining together to develop this program was the Brazilian Association of Vegetable Oil Producers - Abiove, the National Cereal Exporters Association, the Mato Grosso Soybean and Corn Producers Association, and the Institute for Responsible Agriculture.
The target audience for this program is specified as being the countries in the European Union. More than 60% of the soybean meal exported from Brazil is destined for the European Union where consumers are much more likely to demand products that meet higher social and environmental standards as far as the environment, workers, and communities are concerned. Brazil exported 12 million tons of soybean meal to the European Union in 2009. Organizers of this effort feel that one quarter to one third of Brazil's soybean production will meet the requirements of the program in two or three years.
In making the announcement, the president of Abovie cited studies indicating that at least 20% of consumers in the European Union would be willing to pay a premium for products that are produced in an acceptable sustainable manner. The program developers hope that sustainable soybeans produced in a socially and environmentally acceptable manner will command a premium from the consumers although no premiums amounts were announced. If farmers achieve this seal of approval, they will receive a financial benefit on the front end by being eligible for lower interest subsidized loans from the Brazilian Developmental Bank.
In order to be certified as a Soja Plus producer, a farm must meet the majority of the 46 requirements established by the program. These requirements involve environment, social, and sustainability goals. If a producer meets 80% of the program requirements, his soybeans will be deemed Silver Soja Plus, if they meet more than 80%, they will be deemed Gold Soja Plus. The hope is that the silver and gold seals of approval will command higher premiums.
The program is scheduled to start in October when the first farms will undergo independent audits to certify how many of the requirements have been met. In Mato Grosso for example, it is expected that 20 to 40 farms might be certified during the first year. Agricultural processors and grain companies will also be part of the program because the Soja Plus products must be kept identity preserved from non-certified products.
Achieving the Soja Plus seal is going to increase the expense of growing the soybeans, processing the soybeans, and shipping the soybeans. Its conceivable that there could be four categories of soybeans produced in Brazil - traditional, Soja Plus, Silver Soja Plus, and Gold Soja Plus. Each category would need to be identity preserved and it remains to be seen if the premiums will be high enough to justify the expense.