May 2004Un8ited Soybean Board 1 New Value-Added Products from Soybeans Opportunities for North American Soybeans
May 2004Un8ited Soybean Board 2 “The stone age did not end because we ran out of stones.” -Unknown
September Omni Tech International Anything you can make out of petroleum, you can make out of soybeans… except money 2006 Well maybe…
September Omni Tech International 4 World Soy Production Million Metric Tons
September Omni Tech International 5 World Soy Production Million Metric Tons
September Omni Tech International 6 North American Production & Utilization 2005 Marketing Year Whole Soybean production 3.5 Billion Bushels Soybean crush 2 billion bushels Soybean Exports0.9 billion bushels Carryover and other 0.6 billion bushels
September Omni Tech International 7 What is in a Soybean?
September Omni Tech International 8 North American Soy Crushing NA crushes billion bushels or million tons billion lbs of oil or about 2.8 billion gallons (10.6 billion liters.) million tons of soybean meal.
September Omni Tech International 9 What About Value Old value ratios (typical) If whole beans were worth X, then oil was worth X and meal is worth X. Example if beans are worth $6/bu ($0.10/lb) then oil is worth $0.22/lb and meal is worth $180/ton ($0.09/lb) Oil value= $2.42 (35%) Meal value= $4.41 (65%) Return to crusher= $6.83/bu Meal set demand, but oil made the margin.
September Omni Tech International 10 What About Value Recent value ratios (Summer 2006) If whole beans are worth X, then oil is worth X and meal is worth 0.8 X. Example if beans are worth $5.40/bu ($0.09/lb) then oil is worth $0.26/lb and meal is worth $150/ton ($0.075/lb) Oil value= $2.86 (44%) Meal value= $3.68 (56%) Return to crusher= $6.54/bu Oil is now determining value and driving demand
September Omni Tech International 11 NA Soybean Oil Consumption USE Food95%88% Feed~2% Industrial3%10%
September Omni Tech International 12 Soybean Oil Demand Drivers Food demand flat to down, due to lost share (corn, canola), transfatty acid issue. Feed use is incidental, up slightly with increased crush. Industrial use is small compared to food use, but increasing rapidly due to biodiesel, plastics and other industrial uses.
September Omni Tech International 13 Soybean Meal Consumption USE Food~ 4%>8% Feed95%90% Industrial<1%~ 2%
September Omni Tech International 14 Soybean Meal Demand Drivers Food demand is increasing significantly due to soy dairy substitutes and concentrated proteins, still relatively small compared to feed. Feed use is flat with increased crush. Industrial use (coatings, adhesives) is increasing but remains very small percentage of total.
September Omni Tech International 15 New Industrial Uses Biodiesel Plastics Lubricants Paints, Coatings & Inks Solvents Adhesives
September Omni Tech International 16 Price Changes – 1990 thru /1/05- Soy Oil 21¢/lb. Crude $58.42/barrel Gas $13.03/MMBTU 6/16/06- Soy Oil 24.9¢/lb. Crude $70.20/barrel Gas $7.46/MMBTU
September Omni Tech International 17 Biodiesel Tax incentives and mandates in the US should drive biodiesel production to 240 million gallons (912 million liters) in 2006 Up 320% from 2005 Equal to almost 9% of NA soybean oil production.
September Omni Tech International 18 Biodiesel Economics Per gallon Feedstock Other production0.400 Plant gate$2.425 Less federal incentives Before freight$1.325 Local spot petrodiesel*2.055 Gross margin$0.730 *Energy Management Institute 5/17/06 Memphis TN
September Omni Tech International 19 PLASTICS/PLASTIC COMPOSITES Market segments Current Polyols for Polyurethane foams, films, molded parts Plastic Composites Emerging Thermoplastics
September Omni Tech International 20 North American Polyurethane Demand (millions lbs.)* 2000A * PUR Polyol *2004 API End Use Survey
September Omni Tech International 21 Polyols & Intermediate Prices 2001 – December, 2005 Cents per Pound
September Omni Tech International 22 Soy Polyols At least five different chemical modification approaches Range of costs and uses Molded foam Slab foam Carpet backing RIM and SMC parts UTT Carpet Mill- Dalton GA
September Omni Tech International 23 Flexible Foam Seating Cargill supplying Woodbridge in Ontario for use by Ford
September Omni Tech International 24 Target Area: PLASTIC COMPOSITES Soy-based thermoset resin Polyester resin with fiberglass filler Use by Ag Equipment manufacturers Testing by auto makers Polyurethanes Testing pultrusion of parts Testing molding techniques and different fillers
September Omni Tech International 25 Polyester Intermediate Prices 2001 – December, 2005 Cents per Pound
September Omni Tech International 26 Lubricants Soy Oil versus Petroleum Basestocks Soy Oil Advantages Better lubricity Lower volatility Better viscosity index Soy Oil Disadvantages Poor oxidative stability Poor low temperature properties
September Omni Tech International 27 Lubricant Basestock Prices 2001 thru October, 2005 Cents per Pound
September Omni Tech International 28 LUBRICANTS & HYDRAULIC FLUIDS Current Total loss applications 2-cycle engine oil Some hydraulic fluids Transformer fluids Metal working Mold release and other industrial
September Omni Tech International 29 LUBRICANTS & HYDRAULIC FLUIDS Researching Crankcase oil development at Valvoline Hydraulic fluid formulation at Afton (Ethyl Corporation)
September Omni Tech International 30 Paints, Coatings & Inks Traditionally largest industrial market for soybean oil. Alkyd resins declining with decline of oil based paint. Soy ink growing as price is more competitive.
September Omni Tech International 31 Paints, Coatings & Inks Research Water based (latex) paints Powder coatings UV cured inks.
September Omni Tech International 32 Latex Coatings Intermediate Prices 2001 – December, 2005 Cents per Pound
September Omni Tech International 33 Powder Coatings Intermediate Prices 2001 – December, 2005 Cents per Pound
September Omni Tech International 34 Solvents Primarily Soy methyl esters Same as biodiesel with slightly different standard. New compounds in development.
September Omni Tech International 35 Solvent Prices 2001 thru October, 2005 Cents per Pound
September Omni Tech International 36 SOLVENT MARKET APPLICATIONS COMMERCIAL Parts cleaners & degreasers Hard surface cleaners Stainless steel equipment cleaners (Restaurants) Printing ink cleaners Paint strippers Adhesives removers Mastic removers Graffiti removers Asphalt cleaners & release agents Concrete & wood stains Hand cleaners Hand lotions Oil spill remediation Corrosion protectants Oil field equipment cleaners Plant floor cleaners
September Omni Tech International 37 APPLICATIONS IN DEVELOPMENT SME: Plastic waste disposal & reuse Highway paving & patching materials Pesticide carriers (mosquito larvicides) Mold & mildewcides Paper pulp recycling Alkyd coating carriers Stationary engine fuels (hydrogen) Soy Oil: Bioremediation (soil & groundwater) Metalworking fluids Emollients (personal care products)
September Omni Tech International 38 ADHESIVES Primary market: Wood Adhesives Based on soy flour or protein concentrates Recently launched new use in interior grade plywood Limited packaging adhesives based on soybean oil.
September Omni Tech International 39 Adhesives Intermediate Prices 2001 – December, 2005 Cents per Pound
September Omni Tech International 40 ADHESIVES Research Improve water resistance to allow exterior plywood use Lower viscosity to allow use in oriented strandboard
September Omni Tech International 41 Fermentation Research Produce ethanol from carbohydrates in soybean meal Real goal is a lower cost protein concentrate 70% protein No indigestible sugars/anti-nutritionals Improved storage properties.
September Omni Tech International 42 Thank You Any Questions?