VIDEO: Jasper Soy Processors gains traction in exports
JASPER, Minn. -- Brian Sievert leads a family soybean feed processing manufacturing business that has been in his family since 1985, but is constantly evolving.Thirty years after its start, Jasper Soy Processors LLC marked its first export sale t...
JASPER, Minn. - Brian Sievert leads a family soybean feed processing manufacturing business that has been in his family since 1985, but is constantly evolving.
Thirty years after its start, Jasper Soy Processors LLC marked its first export sale to dairies in Ecuador in 2015. In 2016, he hopes to be selling meal to Brazil, and the company is doubling its size by adding a 12,000-square foot facility next to the existing location.
Brian, 37, has been general manager since 2011, and his brother, Mark, 34, is the company’s office manager. Sievert says his company is well-positioned geographically for its regional customer base and for the availability of beans.
“Most of our business is still local, but this opens up new thinking for us on our availability of sales,” he says of the Ecuadorians. “We have an economical price for them, even with distances they want it to be hauled. As long as they keep ordering it, we’ll keep supplying it.”
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Center of beans
Jasper, Minn., is a town of 630 people in Pipestone County, three miles east of the South Dakota state line and 25 miles east of Del Rapids, S.D.
The Sieverts’ father, Ron, now 63, grew up in the Pipestone and Hardwick area. Ron started his livestock career in 1976 as a feed salesman in Jasper with MoorMan’s Inc., and later worked for Triple F Inc., a soybean equipment manufacturer based in Des Moines, Iowa. Triple F made the equipment that he installed when he established High-Fat Specialties Co. in 1985.
“A lot of farmers were going broke, including myself,” Ron recalls of the plant’s beginnings when he was still raising hogs, sheep and cattle. “I woke up one morning and said, ‘If I’m going to go broke farming, I’m going take the information I’ve got, and put it into a soybean processing machine that I can take out to farms and process soybeans on the farm at a reasonable cost, and help save some farmers.’”
Ron started with a mobile process, but eventually built a permanent installation in a former auto dealership in Jasper. He remodeled the plant five or six times.
“Producers loved the meal, loved the results they were getting,” Ron says, speculating
there might be seven or eight plants in the state that process with this kind of technique.
The mechanical process leaves a lot of nutrition in the bean. The Vitamin E portion is unhindered, highly available and contains fats, which includes a high level of phosphatidylcholine, an important factor in developing cells.
In 2001, the plant sustained a fire and only partially recovered. In 2009, the company name changed to Jasper Soy Processors. The Sieverts sold a minority share to eight of their customers - livestock producers in the area dairy, poultry and swine industries. The family retains a majority ownership, and Ron owns a majority of the family’s share.
“We needed to expand in order to keep going,” Brian recalls. “It was an uphill battle, and we decided instead of going to a bank, we’d go to our customers, and offered them dividends. It’s always about a win-win, and it worked for everybody.”
Ron has backed away from management, focusing on sales and marketing. Jasper Soybean Processors gets about half of its revenue from feed manufacturing, while the other half comes from feed nutrition consulting and marketing of associated mineral mixes and supplements.
Brian graduated from high school in 1997 and joined the family business. Along the way, he picked up a certificate of professional development in dairy science from the University of Illinois in 2011. He is one of the nutritionists, but the company also hires outside help. Nutritionists go to the farm and study available feed sources - corn silage, hay, haylage or other silages.
“I figure out the rations and what could make the most profit,” he says. “I (suggest) their mineral and protein supplements to go along with that.”
Brian says, “It’s seldom that I don’t find 10 to 15 cents per head per day on diet savings. On a 2,000-head dairy, that’s $200 a day, or $75,000 a year.”
Nutritionists also help with manure and methane management.
‘Cooking’ is key
Jasper Soy Processors is different than many competitors because the meal is the main product and soy oil is the byproduct. The soybean meal is “cooked,” but with no external heat source. The heat comes strictly through a high-friction extrusion process, which yields excess steam.
The extruder generates heat by pushing soybeans through increasingly small chambers until they emerge at a pressure of 400 pounds per square inch. The friction increases the temperature to 300 degrees for about 26 seconds.
The cells in the beans are “masticated,” in a chewing-like pressure that breaks up the cells to make the contents more digestible. The Sieverts liken it to cracking open a chicken egg to get at the nutrition inside.
Once in a liquid form, the beans go through a press, where the oil is squeezed out. The meal is refined without chemicals, which is another advantage in the market. The meal is pressed into a half-inch thick wafer “cake.”
The meal cake is then ground into a fine-textured meal, which is included in feed rations, primarily as a protein source.
The oil fraction in the soybeans “boils,” and remains a liquid until it cools and solidifies before going back into the feed-making process.
The company uses about $8,000 in electricity every month.
The Jasper products are touted for digestibility, an advantage the Sieverts say Kansas State University has quantified.
“We know digestibility is good, based on results, but in the feed business you can’t guarantee anything other than crude numbers,” Brian says.
He and Ron say the products have a digestibility rating as high as 95 percent, compared with solvent extracted meal, which is at 87 percent.
Swine customers report tremendous feed conversion ratios of 2.5 pounds of feed per pound of gain. “Years ago, that was a rarity, but it’s basically due to the digestibility,” Brian says.
Jasper Soy Processors often sells to other feed companies, and they’ll put the feed into starter pellets or use them in complete feeds until pigs finish out.
“We are adding some capacity,” Brian says.
Dairy accounts for 60 percent of his business, swine is about 30 percent and about 5 percent is poultry. The company often takes in customer beans on a trade-in and provides feed for a manufacturing fee.
Jasper Soy Processors contracts some beans when favorable, but most of them are spot-market priced through area grain elevators. Some feed buyers prefer non GMO beans, but most don’t.
“It’s a labor-intensive type of process because of the mechanical shear,” Brian says, noting the business employs four people full time.
Each extruder costs about $70,000. Because of the friction, the machines must be rebuilt every two or three months. “We end up putting about $1,000 into a machine every three months, just in parts,” he says, listing how the dies, screws and chambers wear out.
A single extruder machine can process 1,300 pounds per hour. The company has three machines, with a fourth in reserve.
Brian says his company’s meal tends to trade at a premium to meals made with conventional processes in which the meal is a byproduct to the oil production. They have about 250 customers, mostly in Minnesota, South Dakota and Iowa. He’s sold some soybean oil into North Dakota.
The company markets about 8,000 tons of meal in bulk per year, and puts out about 3,000 tons in 50-pound bags. Last summer, meal was selling at about $370 per ton. Today, with the lower soybean prices, meal is running close to $320 per ton.
In the next five years, Brian plans on further expansion, both in the processing equipment and the mixing facility. In recent weeks the company started moving to double its size, adding a 12,000-square-foot facility, and a chapter in the company’s history.