Argentina growing as non-GMO soybean world supplier

Argentina is going forward as a non-GMO world soybean supplier. “We estimate that non-GMO global soybean market is between 9 to 12 million metric tons, but to guarantee the identity across the supply chain is the key factor to play in this business”, the general manager of Kumagro, Diego Chillado Biaus, opines in dialogue with www.eFarmNewsAr.com.

Kumagro is an Argentine company formed 50/50 by seed company Asociados Don Mario (ADM) and farming, storage and trading company Grobocopatel Hnos. ADM has developed a competitive portfolio of non-GMO soybean varieties; in fact this year the company led by Gerardo Bartolome formally registered eight new varieties, identified by the initial letter K (K4001, K3700, etc.). ADM provides Kumagro these varieties, that Kumagro at the same time supplies to farmers via production contracts.

In the 2016/17 season, Kumagro contracted 12,000 hectares of non-GMO soybean that derived in 40,000 tons of production. One year later, (2017/18) the acreage expanded to 50,000 hectares and the production rose to 136,000 tones. “This 2018/19 season we are closing contracts for more than 80,000 hectares only in Argentina”, Chillado Biaus explains.

The company is producing this specialty in Argentina, Brazil, and Uruguay. “We hope to export 360,000 tones next year, the 40 to 50% from Argentina, other 40% from Brazil and the rest from Uruguay”, the general manager adds.

One characteristic of the business running by Kumagro is the bulk export operation. “The non-GMO soybean has a premium price over the standard one; this premium is sharing across the supply chain and is one of the reasons why farmers planting this soybean. But the overprice of this specialty does not sufficient to send the soybean by containers”, Chillado Biaus says.

Kumagro is operating over San Pedro port, on the Parana River in the Buenos Aires province. This port is handling by Grobocopatel Hnos. and provides the logistics capabilities for the operation. “There is two large business for the non-GMO soybean: feed and food. Currently, we are developing the feed business, supplying our soybean to importers in the North Hemisphere, Russia for example. But importers require volumes met with a Handy size cargo, that is to say, no more than 35,000 tons. And the San Pedro port is ideal for this cargoes. Even though Kumagro pays to Grobocopatel Hnos. for port services as a usual customer, the fact that they were partners in the business give the operation agility and competitiveness”, he explains. The San Pedro port offers near 100,000 tons of storage capacity and the company is investing in expanding it via new warehouse.

In dialogue with www.eFarmNewsAr.com, Mr. Chillado Biaus anticipated that they are planning to export 700,000 tons of non-GMO soybean in the next few years, from South America. Also, they hope to grow in the food market. In fact, they are in contact with Eastern Asia companies with this objective. In the local place, Kumagro is supplying food companies like soybean juice manufacturers.