Know Your Customers, Know Your Impact

By Christine Tew

With more than 90 percent of soybean meal destined to feed livestock, both domestically and internationally, soybean markets – and by extension soybean farmers – have an undeniable relationship with livestock producers and animal agriculture.

The use of soybean meal as a key feed ingredient is an important part of Missouri animal agriculture. While the degree to which animal agriculture utilizes soybean meal has fluctuated with time, it remains a key driver of animal agriculture success in the State of Missouri.

“Livestock are our number one customer when it comes to soybean meal,” said John Kelley, a farmer from Faucett. “We depend on the demand they create.”

The success of Missouri soybean producers and animal agriculture likewise has a large impact on the rest of the state and regional economies.

In Missouri, that impact from animal agriculture contributed amounted to $11.2 billion in economic output. Specifically, that impact came in the form of 64,589 jobs and $2.3 billion in earnings. On those, local state and federal governments received $541.5 million in income taxes and $193.4 million in property taxes.

Digging deeper into the species consuming Missouri’s soybean meal highlights the importance of poultry production to soybean markets.

Livestock and poultry consumed 1.2 million tons of soybean meal in 2017. That soybean meal was fed primarily to:

• Broilers (538.4 thousand tons)

•Hogs (371.9 thousand tons)

• Turkeys (168.3 thousand tons)

“I remember back several years ago, probably more than I want to admit, people used to go to a farm sponsored meeting and complain if chicken was on the menu – they thought we should only be eating beef or pork because we should be eating what we had used our product to feed,” said Kelley, who has volunteered with many of Missouri’s ag organizations, including the Missouri Soybean Merchandising Council and Missouri Farm Bureau.

Today, not only has the poultry industry demand for soybean meal grown, so has understanding of the end users for Missouri’s soybean crop.

“Things have changed a lot in the last few decades,” Kelley said. “There are a lot more chickens and turkeys eating our soybean meal than there used to be. And that’s a good thing – we work hard to keep growing demand for our product.”

Over just the past ten years, the impact of animal agriculture has been a significant economic driver for Missouri.

From 2007-2017 animal agriculture in Missouri economic output increased by over $2.1 billion, boosted household earnings by $418.9 million, contributed 11,263 additional jobs and paid $98.2 million in additional tax revenues.

Nationally, the numbers are similarly impactful, with animal agriculture contributing more than 1.8 million jobs to the U.S. economy in 2017, along with adding $347 billion to the U.S. gross domestic product and $75 billion to household income. At the national level animal agriculture also contributed nearly $18 billion in income taxes and over $7 billion in property taxes.

These numbers, and the analysis behind them, come from the Soybean Meal Demand Assessment 2007-2017, which was released in September 2018. The report also includes detailed estimates of soybean meal and hull consumption by species and by state.

The analysis identifies the contributions of animal agriculture to output, earnings, employment and taxes by state. It tracks shifts in animal production over the past 10 years, and then reveals the economic impact of those changes both by state and nationally. For instance, the increased value of animal agriculture production between 2007 and 2017 resulted in a boost of over $32 billion in total national economic output. This growth increased household incomes by almost $7 billion and supported an additional 159,786 jobs.

The report was completed by Decision Innovation Solutions for the United Soybean Board and is available in its entirety on the USB website at http://unitedsoybean.org/topics/animalag/.

In addition to analysts from Decision Innovation Solutions, many subject matter experts

contributed to this report. Among those subject matter experts assisting with the report was Eric Bailey Ph.D. of the University of Missouri.

 

The United Soybean Board contributed to this report.

View the rest of this issue in the magazine here.