trans fats

[disker]

Hi,
Just wondering what your guys thoughts were on growing the Nexera type canola. All this talk of big chains going to the stable oil, will there be enough supply. If it comes to where Nexera type is the standard(no premium) does that mean discount for regular canola. Also with the biodiesel, will there become an high oil content canola not for human use. Do you think this will become an issue as I have been looking at pricing for the fall of 08. I grow only regular canola now, mostly hybrids and have not seen a real benefit in the Nexeras because the premium usually just equals the yield loss(my experiences).
Disker

[thegrainguy]

Disker

This oil needs to be supplied to these endusers to make this market grow and show breeders that you are interested in keeping this market viable.

If you dont supply them the product it will go away.

Have you looked at what AU is offering. Different windows of delvery with an increase in premium if you wait longer to deliver. As high as $55.00/MT.

And they are also giving interest free inputs until the product is delivered.

It is worth looking into.

[craig]

In shorter season areas Nexera varieties continue to show problems with green seed even last year after all the hot weather. It's too bad agronomics are not seemingly getting better for these varieties. We had some Bayer special oil trials on our farm last year and hopefully more players will improve the situation. Until I see something better I will keep growing high yield hybrids

[wd9]

Disker, canola oil of both types are utilized for food. High stability is generally for frying, whereas "normal" canola has uses in mayo, spreads like margarine, and salad dressings.

Other designer oil profiles will be showing up and pricing will of course vary.

Long and short of it, because new profiles are showing up, it does not mean the old standby has less value - just less hype.

[TOM4CWB]

WD9,

It is interesting that in salad dressings and this type of use, the high stability oils are not as healthy as standard canola oil.

Cooking with the oil, for long periods, is when the trans fats form.

I hope I have this right, WD9, kind of why high stability oils are not normally on store shelves!

[rbrunel]

I grew all specialty oils in 2006, my experience with both have been ok. I find that the nex varieties have higher yeild potential with the 830 sometimes out yeilding the invigors on my farm. I just find that the delivery periods tend to constrain cash flow. But I am sure glad to catch this premium on a rising market like this year. It may make up for our disastruous 22bu ac canola crop. But the comment on growing seasons is a legitamate one as far as I am concerned, although i have never had a problem in the last 4-5 years.

[wd9]

TOM4CWB, I will throw in my 2 bits on this. Caution, learning ahead.

" ** It is interesting that in salad dressings and this type of use, the high stability oils are not as healthy as standard canola oil."

The high stability canola oil has reduced polyunsaturated fat (PUFA or linoleic acid). It doesn't make it less healthy, just changes it's characteristics. The PUFA is the stability issue as it loves to oxidize which is what causes the problem at higher temps. The extra hydrogen atom in the polyunsaturated is what cause the instability to occur. Reduce the PUFA to increase stability. Exactly what Dow and Cargill oils do. The profile of the oil different, but since the balance of saturated to unsaturated is the same, healthwise, just as healthy.

" ** Cooking with the oil, for long periods, is when the trans fats form. I hope I have this right, WD9, kind of why high stability oils are not normally on store shelves!"

It isn't on the shelves because people at home can use normal oil for a couple hours at reduced temps and do not face the issues that A&W does cooking for endless hours a day at commercial temps and production levels.


Now I am not a dietitian, but will give the explanation a try.

Transfats are formed from partial hydrogenation - the adding of hydrogen in an incomplete manner. Transfats are in terms of building blocks the same as other fats, however they have a different shape. In transfat molecules the carbons are joined in the trans configuration (flattish) as opposed to a cis configuration (like a hockey stick) shape. The flatter shape packs like sheets of wet paper and is what causes the heart problems, but makes great baking and stability characteristics by increasing melting point and "viscosity". Crisco figured this out in about 1910.

Interesting to note 100% hydrogenated fat is in cis configuration and is as healthy as the original oil, it just is very expensive to produce. If you follow biodiesel production, the new hydro-cracking or NESTE process utilize this technique to make bio-fuel.

Cooking at high temps does add a bit of trans, but is not the concern. The health concern is the partially hydrogenated fats. Ironically there isn't much data on whether or not low levels of trans are more or less healthy than the same level of saturated fat.

Given the media and the evil connotation of hydrogenation, even if the biodiesel industry makes a cost effective way to 100% hydrogenate oil, it wouldn't be sold for food. That product would be stable, healthy, be great for baking, greatly reduce saturated fat and make another reason to sell more canola.

Also, the term High Oleic Low Linoleic (Dow Specialty or Cargill specialty oils) are classed as high monounsaturated (Oleic) low polyunsaturated (Linoleic). These terms I am sure you have heard often.

So, unsat fat is healthy, sat is unhealthy. Canola oils we will grow in the future will be characterised on the balance of properties the food company wants - like high monounsaturated (Nexerra or CSO) or even high in polyunsaturated for unique flavour and taste.

You all probably hear this stuff all the time and it is actually quite complex in the background. Just ask if I missed something or if it isn't clear and I will try.

For further reading:

http://en.wikipedia.org/wiki/Fat - click on the different fat types.

http://en.wikipedia.org/wiki/Canola

and of course:
http://www.canola-council.org/cooking.html

[Braveheart]

disker, we have had excellent yields with Nexera here in southern MB (Nex 828 this year). Yield was right up there with the hybrids at 45 bus/ac. Movement through AU has been good.

However, we won't grow Nexera this year because the premium has been reduced. This tactic of offering premiums to attract new production streams and then eroding the premiums every year is maddening. It happened with Warburtons, the hard white wheat program, and now Nexera. I'm sure that Dow, AU, JRI, and Bunge aren't making less on Nexera but they're asking farmers to take less (because they know farmers will). It seems that with these new potential crops we start out being part of a value chain and end up being just being the supply part of other companies value chain. The companies seem to like the "how low will it go" approach to premiums. How low will it go before the farmers won't grow it.

With all the other canola choices and their yield potential, marketing choices, etc., I think farmers should send the message that you either pay me the premium that was or raise it, or forget it.

[wd9]

Incentives are to get a product going, or keep it going if there is trouble maintaining supply.

The latter is not a problem as farmers will produce it with a small premium as well as probably without so why should a company give you more money then they have to?

Braveheart are you saying no premium is better than a small premium?

[ianben]

The latter is not a problem as farmers will produce it

Not if Braveheart's example is followed.

As farmers become more informed I think we will know the value of what we produce far more.

These oils must have saved McD etc a lot of money and improved their image I am sure they have been charged accordingly.

I have grown Nexera here in UK but will not again without an increased premium

[Braveheart]

wd9, I would have to answer yes, no premium vs a small premium. Here's why. First, these commodities have to be IPed. For people like me who don't like investing money in on storage equipment it is a downside. On farm storage for me shows a negative return and I don't have excess. A decent premium makes the extra work and investment somewhat better, but a small premium, no way.

Second, cash flow is king on our farm. We're fairly highly leveraged and like all businesses we need to generate cash flow at times to meet committments. IP crops can't always be turned into cash if the delivery period just doesn't match up with cash flow needs. (This happened a lot with Warburtons.) But, if the premium is decent, creditors don't mind extending credit. If the premium is small, it leaves them scratching their heads as to our management decisions.

Third, as in ianben's posting, companies are usually improving their profits with these new crops. If my goal is increased profits and wealth, why should our business take less?

These programs with IP, premiums attached are more work, sometimes require more investment and limit my cash flow choices. If I take less premium and continue to produce, it sets up this cycle of being squeezed to do more work, invest more, take more risk for the same reward or usually less.

[disker]

Hi,
These are the points that I was the most concerned with. IP crop premiums have been based on the fact that if you grow 5 bus/ac less @ $8.00/bus then the premium is up to $40. They try to only reflect the loss in yield potential, not that it is value adding. My concern with this multi strains of canola is that they will try and forget the premiums altogether and use the discount theory.
To me the niche market that some anlaysts are talking about for our canola market only works for a few years until "niche" becomes a commodity.
The ethanol thing concerns me a bit too. What happens if the US and ourselves starts growing these huge crops to fill the ehtanol plants and then the gov't subsidies come off ethanol. Do you think the big money is going to stay in ethanol if they have paid for the plant while under subsidy, made a profit until that time. They will not take a loss for the good of the nation, Mothball and can you say an extra 7 million acres of corn?? Ouch!!! I hope things move smoothly but gov't subsidies affecting acreages seeded always seems to come with a price. Sorry about off topic, but just my 2 cents on the future.
Disker

[sawfly]

had a phone survey call the other night on Nexara

asking if i would consider growimg it at various preimiums 25 $ 42$ 64$ or carriying the inputs.

actually had the same type of survey 2 years ago. when they came out with their program they had picked the lowest prem.

with their poor yeilds and green i never grew any.

so if they call tell them to take a hike . that its just not economical.
maybe that will smarten up their priem.

[wd9]

But isn't this what makes canola such a great crop? The ability the choose whether or not you feel a particular system or characteristic is best for your farm. Some growers do well with specialty, some get burnt and never do it again.

The only thing that is ever going to change the premium and values placed on what the grower will get is when the need outstrips production. As Larry Weber says, you guys feed the bull to the bear. We overproduce and then we whine there is no money in it. And the bear burps, and then the companies say thankyou very much.

Trick is I think, how do we determine that balance between excessive price killing carry-over and stifling new market development by not having enough product?