Rows of healthy agricultural soybean crops. Beautiful sunset landscape.

Increasing domestic demand for our state is a focus of South Dakota Soybean

May 11, 2019

“South Dakota has so much potential to expand our livestock finishing, aquaculture, biodiesel and processing industries,” explains Jerry Schmitz, SD Soybean Executive Director and Vermillion farmer. “Why not take advantage of the tremendous opportunity to process what we raise locally?”

Motivated by low prices and shrinking export markets, resulting from the recent trade war with China, farmer-leaders of South Dakota Soybean Research & Promotion Council (SDSRPC) and South Dakota Soybean Association (SDSA) are exploring opportunities to expand local demand, says Goodwin soybean farmer, Todd Hanten.

“Our basis has gotten really bad. The closer you get to the processing source, the cheaper feed becomes for livestock producers and, basis increases for soybean growers,” says Hanten, who serves as SDSRPC Vice Chairman and District 6 Director.

Hanten understands the benefits of a local processor because his cattle finishing ration includes soybean meal. The Goodwin farmer says the meal provides a superior, consistent source of protein to the 1,100-head of cattle he feeds on his farm annually. And, as one of nearly 11,000 South Dakota soybean growers, he sees value in utilizing a local commodity.

“We pull soybeans from a bin on the farm, haul them to the processing plant in Volga and Dawson Minnesota and return with a semi-load of soybean meal or soy hulls that we unload into a hopper bin on the farm,” says Hanten who hopes to see more South Dakota crop farmers add livestock to their operations. “I consider myself lucky to have two processing plants, both 40 miles from my farm where I can deliver soybeans directly to and purchase soybean meal and soy hulls. Not one extra mile or freight expense.”

A diversified farmer his entire farming career, when Hanten sold his dairy cows in 2012, he converted the dairy barns and feedlots into a beef cattle finishing operation.

In addition to another income stream, Hanten says livestock compliment the soybean, corn and spring wheat crops.

“I appreciate the lifecycle of a diversified farm. We feed the grain and soybean meal we raise. We use the spring wheat straw for bedding, and we return the livestock manure to the soil,” Hanten says. “It’s a perfect fertilizer, building organic matter and improving the soil’s overall health.”

Hanten adds that South Dakota is a livestock-friendly state. And, since 2015, SDSRPC has worked to enhance education acceptance of concentrated animal feeding operations through Hungry for Truth, a checkoff-funded initiative designed to open conversations about food between South Dakotans and the farmers who grow it.
Checkoff funds also helped advance the development of aquaculture in the state, by supporting South Dakota State University researchers in development of a process to extract high-quality protein from soybeans for fish food.

Today, Prairie AquaTech of Volga is projected to use 55,000 tons of soybean meal in the production of a high-quality protein ingredient used in fish food.

A short drive south of Volga, the rural community of Madison will soon be home to another aquaculture business, the tru Shrimp Company, plans to build their first shrimp production facility. Thirty-five percent of the shrimp’s diet is soy-based, consuming more than 5 million pounds of soybean meal and concentrates each year.

“Growth of aquaculture in our state opens up a tremendous, local, demand opportunity for South Dakota’s soybean growers,” explains Matt Bainbridge, an Ethan crop and livestock farmer who serves as District 1 SDSRPC Director.

Checkoff dollars also assisted in the development of biodiesel, yet another soy byproduct. A clean burning and renewable fuel, biodiesel utilizes about 5.6 billion pounds of soybean oil each year, while at the same time reducing emissions.

“In this tight economy, increasing domestic demand for soybeans through biodiesel is a win-win for soybean farmers and all who value clean air,” says Tim Ostrem, a Centerville soybean grower who is the SDSRPC District 2 Director and represents South Dakota on the National Biodiesel Board.

Biodiesel currently adds about 90 cents per bushel to the price of soybeans, increasing the income of the average South Dakota soybean farmer by more than $30,000 annually. Each year, Biodiesel adds $230 million dollars to South Dakota’s economy.

Ostrem, who uses a biodiesel blend in his diesel-powered equipment, says by using biodiesel, farmers and supporters of South Dakota’s number one economic driver, can help increase local demand for soybeans.

“Any way we can increase demand locally will help enhance market prices,” Ostrem says.
Farming more than 40 years, Ostrem has seen tough economic times before. He started farming fulltime in 1976, when extreme drought, low markets, and high-interest rates forced many South Dakotans out of farming.

“Increasing demand is what we need to do to be sustainable for future generations of farmers,” Ostrem says.

To learn more about SD Soybean efforts to support South Dakota’s agriculture industry, visit