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SOCIETY IN THE MAKING: THE DEVELOPMENT OF
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Feng-Huang Wu
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SOCIETY IN THE MAKING:
THE DEVELOPMENT OF THE SOYBEAN
INDUSTRY IN THE UNITED STATES

By
Feng-Huang Wu

A THESIS

Submitted to
W? State University

in partial fu fillment of the requirements
for the degree of

MASTER OF ARTS

Department of Sociology

1995

ABSTRACT

SOCIETY IN THE MAKING: THE DEVELOPMENT OF
THE SOYBEAN INDUSTRY IN THE UNITED STATES

By

F eng-Huang Wu

'Ihispaperfocuses ontheearlystagesofthesoybean industryintheUnited
States in the period between the end of 19th century and the 19705. Diflirsion and
adoption of innovation theory, induced innovation theory and actor network theory are
used to discuss and analyze how social processes were initiated through the
establishment of a variety of institutions, promotional programs, governmental policies
and individual efforts, and further to understand how these social processes contributed
to the conception and development of the soybean industry. The findings show that
the adopting behavior of individuals and the institutional innovations were only partial
causes of the success of the soybean industry. More important contributions were the
overall social processes initiated by the soybean actors in a social network through

interest translation, enrollment of allies, persuasion, negotiation and coercion.

Acknowledgements

There are many people to thank for their support and help. First I would like
to thank my advisor, Dr. Lawrence Busch, for guiding me through the whole research
process. His ready availability, advice and patience are greatly appreciated.

I also would like to thank my other committee members, Dr. Christopher
Vanderpool and Dr. Marilyn Aronoffi, for their valuable suggestions and constructive
criticism

Special thanks to fellow graduate students, faculty and friends in the
Department of Sociology and MSU community for providing an enjoyable learning
environment and support throughout the process.

Finally, and most importantly, I am indebted to my family for their faith,

support and encouragement in my studying abroad.

iii

TABLES OF CONTENTS

LIST OF FIGURES

CHAPTER 1. INTRODUCTION
1.1. The Diffusion and Adoption of Innovation Theory

1.2. The Induced Innovation Theory
1.3. The Actor Network Theory (The Translation Thoery)

CHAPTER 2. GENERAL DESCRIPTION OF THE
DEVELOPMENT OF THE SOYBEAN INDUSTRY

2.1. Period I (1765-1931)
2.2. Period II (WW I: 1939-1945)
2.3. Period 111 (WW II and Postwar Era: 1946-19703)
2.4 Period VI (Cold War Bra: 19705)
CHAPTER 3. Conclusion

BIBLIOGRAPHY

iv

18

21

26

27

35

1

LIST or FIGURES

Interest Translation and the Enrollment of Actors

34

diaper 1
Introduction

Research inquiries into agricultural development in the United States have been
the concem of related disciplinary studies for decades. In many of them, technical
determinism is presumed to be the driving force in contributing to the rapid growth of
agriculture. For instance, the literature on induced innovation theory (Binswanger and
Ruttan, 1978; Ruttan, 1982; Hayami and Ruttan, 1985) reveals the technology-driven
characteristic of agricultural development fi'om results of historical analysis among
various nations. On the other hand, diffusion and adoption of innovation theory
approaches agricultural development flour a micro-setting, a farm scale. And
individual farmers are considered to be capable of determining the viability of
technieal change.

Although these theories have tackled technical change in agriculture from both
the macro- and micro-level, they fail to elaborate how and in what way dynamics are
constructed within subsectors with respect to technical change, and hence how farming
is transformed into industrial agriculture. To pursue this inquiry, an historical review
ofthe soybeanindustryintheperiodfromdreendoftl're 19thcenturytothe 19708 is
employed in order to understand how social context chronologically impinges on the
process of technical and agricultural development Therefore, I will examine how
social processes (i.e., negotiation, persuasion, coercion) were initiated through the
establishment of a variety of institutions, promotional programs, governmental policies

2
and individual efforts, and firrther to understand how these social processes contributed

to the conception and development of the soybean industry.

The main reason to use soybeans as a case study is its economic role. Since the
19603 soybeans have been transformed fiorn a barely known exotic crop into the
rmtion's second most valuable crop. Throughout the process, the versatile usage of the
soybean not only has co-evolved with the development of the entire food industry, but
it is also utilized in livestock production, the automobile industry and the paint
industry. Moreover, the development of the soybean industry parallels that of
agricultural industrialization and is involved with the whole spectrum of issues in
political, economic, and societal change.

To achieve the objective of this paper, various disciplinary studies are
examined to increase our comprehension of the relationship between technical change
and agricultural development. They include the difl’usion and adoption of innovation
theory, the induced innovation model, and social network theory (translation theory).
Each theory provides an insightful research methodology to approach the relation
between technical change and agricultural development. However, it is my intention to
point out that without the dynamic mechanisms among a variety of sales programs,
research advances and government policies, which were initiated by subsector actors,
the soybean would not have been transformed into a commodity crop. Hence, I intend
to argue that technical change in agriculture is constructed as a result ofa complex
social process among actors linked in a network (Tanaka, 1992).

3
1.1. The Diffusion and Adopion of Innovation Theory

The diflirsion and adoption of innovations dominated the approach to
agricultural research taken by sociologists from the 19503 to the 19703. Taking
technical change as a necessity in agricultural development, the strategies of diffusion
theory are to employ extension institutions and to improve communication strategies in
order to diflirse innovations to farmers. The model focuses at the farm level and
farmers are viewed "as actors, at a farm level and community situation, responding to
stimuli, 00nt what were unquestionably viewed as improvements in agricultural
technology" (Fliegel and van E3, 1983: 13-28).

Programmed as top-down strategies for diflusing innovations, the diffusion and
adoption of innovation model focuses on three factors which are of concern in
determining the viability of irmovations throughout the difl’usion process: ( 1) the
adopting potentiality of farmers, (2) the characteristics of new practices and (3) the
frequency of interpersonal communication. Accordingly, models of farmers' adopting
behavior are established to examine their socio-economic characteristics, personality
variables, and cormnunication behavior (Rogers, 1983). In addition, the contents of an
innovation are studied under the following categories: the degree of complexity of the
idea, the divisibility (trialability) of the product or practice, the congruence of the
technology with existing practices, the economics of the practices, compatibility with
existing values, past experiences and needs, and observability of an irmovation to
others (Buttel et. at., 1990, Rogers, 1983). Moreover, interpersonal communication

4

among farmers also determines the rate of adoption of an innovation.

With the assumption of a positive correlation between the frequency of
interpersonal communication and the rate of adoption, the model is often employed in
collaboration with extension agents in order to exercise technical change in agriculture.
As a result, it is credited with contributing to the success of the Green Revolution in
most developing countries. However, the political and economic impacts on farmers as
a result of technical change have been the subject of a variety of debates (Sousa et. al.,
1985).

1.2 The Induced Innovation Nbdel

In the discipline of agricultural economics, the induced innovation model first
arguesthatagricultmehasbeentransfonned fiomaresornoe—basedsectortoascience—
based industry. Therefore, the capacity to develop and manage technologies, which are
consistent with physical and cultural endowments, becomes the determining factor in
agricultural development (Rattan, 1982). The development of such capacity includes

the capacity to organize and to sustain the institutions that generate and
transmit scientific and technological knowledge, the ability to embody
new technology in equipment and materials, the level of husbandry skill
and the educational accomplishments of rural people, the efliciency of
input and product markets, and the effectiveness of social and political
institutions (Ruttan, 1982: 17).

5
As to the development of new technologies, there are two characteristics of

technical change in agriculture: on the one side, new technology has an exogenous
dimension that stems fiom developments in basic science; on the other side, new
technology is an endogenous factor which is influenced by demand, such as the
relative scarcities of factors of production (i.e., land, capital and labor) (Busch et al.
1989). For instance, the development of mechanical technology in the United States
substituted for an insufficient labor force and biological technology (e.g., hi gh-yielding
varieties) substituted for the scarcity of land in countries such as Japan and Taiwan
(Ruttan, 1982).

Other than the dimension of technieal capacity, the institutional behavior of
research institutions contributes by improving the allocation of social resources and
represents the critical link among scientific communities, farmers, bureaucrats, and
politicians. Demand-induced institutional innovation become an eflicient supplier of
technieal innovation (Binswanger and Rattan, 1985; Ruttan, 1982). In sum, the theory
of induced innovation implies a dynamic and dialectieal interaction between technical

and institutional change.

1.3. Actor Network Theory ('Thmslation Theory)

Originating in the sociology of science, actor network theory abandons the

traditional presumption of technical change on one hand and the social context on the
other. Instead, it argues that the technical content is constructed and mobilized by

6
actions taken by scientists, or broadly speaking, the social context Basically, it claims

that the distribution of technosciencel is essentially a fact-building process through
negotiation, persuasion, and coercion among actors in a network (Busch, 1990; Latour,
1987). The network consists of "actan " including human (e.g., fact builders) and
non-human (e.g., technical content) actants in an interdependent relationship, which
permits the transformation of technoscience into a fact or an artifact (Gieryn and
Figert, 1990). In other words, technoscience does not automatically exist; instead, it is
tied to a heterogenous network which functions to settle controversies within the
technical content, to construct the fact and to spread the fact over time and space in
order to network more allies (Latour, 1987).

Actor network theory makes two central points about expanding and stabilizing
the length of networks: "(1) to enroll others so that they participate in the construction
of the fact; (2) to enroll their behavior in order to make their actions
predictable"(Latom', 1987: 108). Although these claims appear to be contradictory at
first, they are two inseparable stages in constructing a fact-building process: translating
interests and keeping the interested groups in line.

Translating interests involves relating the interests of fact-builders to those of
expected and unexpected actors. First of all, fact builders have to state their clairm

clearly to fulfill actors' explicit interests. Second, they have to expand their room for

 

lTechnoscience is defined as "all the elements tied to the scientific contents", which is to
distinguish fi'orn the concepts of "science and technology". Latour argues that "science and
technology" is the outcome of a fact-building process by actants and is what is kept of
technoscience (Latour, 1987).

7
manoeuvering in order to first displace and detour other actors' interests, and

eventually to make their expanding interests appealing to these actors. In this way, the
fact is reified by collective action and becomes an indispensable passage (Latour,
1987).

Keeping interested groups in line is a second step in creating and consolidating
a durable fate for all actors in a network First, fact-builders have to link the fate of
allies together and to resist all trials to break them apart. In addition, as the network
expands, there must develop a machination of forces to enlist rmexpected allies and
consolidate the network (Latour, 1987).

Latour (1987) furthers the applications of network theory in a case study of
Pasteurization in France. The success of Pasteurization in France can be not only
attributed to the great technical breakthrough invented by Pasteur, but also to Pastern’s
ability to mobilize all the social resources to fulfill his needs. As Iatour comments,
Pasteur was "...an expert at fostering interest groups and persuading their members that
their interests were inseparable fi'orn his own" (Latour, 1983: 149). For instance, in
order to carry out Pasteurization, Pasteurians succeeded in persuading French far-mas
not only to make their barns physically resemble a laboratory, but also biologically
controlled their sheep by vaccination Hence, Latour argues that Pasteurimtion in
France was a fact-building process of which the success is attributed to allying various
interest groups.

The theories discussed above identify the characteristics of technical change in
agricultural development. Their relevance will be further analyzed through the

following case study.
Draper II
General Descripion of the Development
of the Soybean Industry

2.1. Period I: 1765-1931

For several rnillennia, soybeans (mm) have been a major protein
source in the Orient, including livestock feed and food products, such as tofu, soybean
milk, soybean sprouts, and misc (\Vrndish, 1981). However, they were mainly a
curiosity to Americans on their first anival on a Yankee Clipper boat trip to China in
1804 (\deish, 1981)2. In 1854, researchers began to collect soybean varieties in
Asia, which were distributed by the US Commissioner of Patents. In 1879 the New
Jersey Agricultural Experiment Station and the University of Illinois began testing of
several varieties. Later, the USDA introduced varieties fiom Europe and the Orient,
and in 19073 published the agronomic characteristics of twenty-three varieties known
in the US (\deish, 1981).

The soybean was mainly used as a coffee substitute during the Civil War.
Later, it was primarily grown inthe Southeast as ahay andpasture crop. In 1911, the

first processing business started in Seattle by processing Manchurian soybeans into

 

2According to Hyrnowitz and Harlan (1983), the soybean was first planted in 1765 (Snrith
and Huyser, 1987).

3According to Lockeretz, it was in 1907 (Lockeretz, 1988).

9
soybean meal and soybean oil. This individual industry did not continue long after the

owner passed away. This was attributed to the lack of a market for soybean products
other than soybean oil (Vdeish, 1981). Although soybeans were known for their high
protein value, the unfamiliar diets and their incompatibility with rrrilk products limited
its market. Processors even sent soy flour to bakers for fiee and opened sale channels
to retailers, but no one wanted it (Wmdish, 1981). In 1914, the first US-grown
soybeans were processed in a mill used primarily for cottonseed in North Carolina

Then came World War I. It caused a general oil shortage and the United
States began to import soybean oil from Manchtnia. Yet, polluted Manchurian oil in
contaminated containers disappointed Amerieans so much that the need for domestic
production emergm Meanwhile, natural disasters, such as the corn borer disaster in
the Corn Belt, soil deterioration in the rice fields and insect disasters in the cotton
fields pointed out the need for an alternative rotation crop.

The increasingdemandforaresolutiontothe farmcrisisappearedtobean
incentive which led to the introduction of soybeans. However, the process of the
introduction was quite dynamic. It involved on-farrn and off-farm actors' activities in
accumulating, mobilizing and distributing resources, rather than a static formulation of
a soybean market. The action was initially taken by individuals (i.e., a researcher and
an entrepreneur), and involved with collective institutional behavior (i.e., a research
institution and a conrparry).

Researchers
As an unknown exotic crop, the introduction of soybeans to resolve the farm

10
crisis was largely attributed to individual agronomists' knowledge and exploitation of
the soybean's agronomic merits. Regarded as grand trailblazers, missionaries and
crusaders, agronorrrists in the USDA and the University of Illinois first enthusiastically
promoted the growth of soybeans. An individual agronomist, Dr. Charles Piper of the
USDA, was "the first man to see clearly the potential of the soybean in Ameriea" and
" a man of intense enthusiasm and vision" (Windish, 1981: 2). Dr. Mlliam B. Morse
of the USDA, influenced by Dr. Piper, "focused his entire life on introducing and
popularizing soybeans and soyfoods in America" (Vdeish, 1981: 6). He also spent
years collecting varieties fiom North China, Japan, Korea and Manchuria to broaden
the soybean gerrnplasm base.

These researchers formed a close-knit group to share information on breeding
soybean varieties for adaptation to local climate, soil, insects, diseases and
photoperiod The accumulation of knowledge on soybeans began to take the forms of
personal afiiliation and organization within research community. As a consequence, it
not only popularized the merits of soybeans as a soil-building and hay crop to farmers,
but also speeded up a variety shift in the field. For instance, in 1922, a pure selection
of Manchu soybeans occupied 65-70 percent of the commercial soybean-producing
area in Illinois. By 1930, 'Illini' substantially replaced Manchu
Dr. Nbrse and The Fstablishnnnt ofthe American Soybean Association

Besides networking the research community, researchers also made comrections
to other mom in order to expand the length of the social network in the form of

an organization. In 1919, Dr. Morse established the National Soybean Growers'

11
Association. Later, it changed its name to the American Soybean Association (ASA),

which was to unify soybean growers and to serve growers' needs by directing a
forceful soybean research agenda. From the beginning, the University of Illinois was
prominent in the affairs of the ASA. Even after the expansion of the interests among
various actors, the ASA continued to look to Illinois for leadership and resources. Dr.
Morse was engaged in reaching out to farmers, researchers and industrialists, such as 1.
Clark Bradley, AE. Staley, Sr., Eugene D. Funk, and Dale McMillian, through
government bulletins and hundreds of addresses at conferences. Later on, these
individuals played a vigorous role in promoting the soybean industry. As Howell has
commented, the success of the soybean processing industry was:

...another element, just as important or even more 30.

First a few and then many more men and women of

vision, imagination, energy, dedieation- remarkable people

and institutions who saw the potential of the soybean and

worked hard to make that potential a reality (VVrndish,

1981: 8).
The Oop Innovement Association md Seed Certification

Although researchers developed superior varieties to raise soybean production,

genetic adulteration in the field deteriorated its performance and discouraged farmers'
confidence in the superior varieties. The major reason was the lack of official and
unified endorsement of the best varieties, so as to motivate farmers' appreciation of

their qualities. The issue was first raised by county farm advisors, who campaigned

12
for pure seeds in order to provide a means of recognizing merit in seed grains. In

1921, the Farm Advisors' Assn. and the Illinois agronomy department began to draw
up a practical scheme of work First, state Crop Improvement Associations
collaborated with universities to examine the eligibility of certified seeds. Later, a
Farm Advisor’s Committee endorsed an agreement on Seed Certification, which was
drawn by state Crop Improvement Associations and researchers. The main task was to
perform field inspections before planting. Consequently, the seeds reproduced by
farmers were forced out of the field and were replaced by the channels of certified
seeds (W mdish, 1981).

The improvement of the combine

At the early stages, soybeans were harvested with existing equipment: small
grain harvesting machines and threshing machinery. The inadequate machinery not
only resulted in a 30% loss per harvest, but also created harvesting difficulties.
Therefore, custom crews preferred harvesting corn which had the same harvest time as
soybeans. However, the increasing plantation of soybeans and technical advances in
mechanics assisted in the invention of a small combine.

In 1923, Taylor Fouts, the head of Fouts Brothers, invented a small combine
and held a promotion conference for representatives from the largest manufacturing
companies. These companies were requested to loan combines to universities for
testing their soybean harvesting possibilities (Lehmann and Bateman, 1944). Although
initially the small combines were poorly suited to soybeans, the later modified

combines and the development of suitable varieties proved its advantages in saving

13
labor and reduction of grain loss (Lockeretz 1988).

Although the small combine partially solved the harvesting problems among
farmers, elevators refused to accept combined soybeans. They were concemed that the
heat caused by combines would endanger the operation and storage. However, an
exceptionally wet season in 1926 changed elevators' hospitality. The combined
soybeans not only resolved moisture problems during the storage period, but also had
a higher germination rate and lower moisture content.

The employment of the small combine indicated that the clientele of an
innovation was not limited to farmers but included other off-farm actors, who also
participated in the formulation of a soybean market. Take combined soybean as an
example. Presumably, farmers were the target clientele who had to balance the
efliciency and cost of a combine and in turn affected the rate of adoption. Yet, the
debate over combined soybeans demonstrated that processors' definitions of what
constituted the good quality of postharvest soybeans played a determining role in the
viability of the innovation Without all these actors' agreement on the use of
combined soybeans, the difiirsion of a combine would have faced difficulty. Put
differently, how technical change progressed in the development of the soybean
industry largely depended on various actors' attitudes toward an innovation, rather than
a single actor such as farmers. This not only challenged the assumption that technical
change was an endogenous factor in agricultural development, but also the
conceptualization that treating farmers as a sole decision-maker on an innovation, the

central themes in the induced innovation theory and the diffusion of innovation theory,

14

respectively.
Promotion by Orshers and Processors

The increasing production of soybeans aroused processors' interests in
producing soybean oil for industrial use and soybean meal for feedstocks. However,
the processors' interests conflicted with those of farmers' and created competition
between soybeans for planting and for processing. First, soybeans were grown as a
hay crop; hence, the demand for seed was strong. Processors had difficulties getting
soybeans at a price that permitted profitable processing, since the value of soybeans
was higher for seed than for processing (Lockeretz, 1988). Second, to make
processing profitable required a market for the meal as a co-product. However, there
was no rationale for farmers to sell soybeans and buy soybean meal made fiom the
commodity they just sold, since they could produce soybean meal on farms. Feed
manufacturers in turn hesitated to add soybean meal to stock feed. Third, the
increasing expansion of soybeans made farmers concerned about the capacity of this
newly and poorly established processing industry. In comparison with the previous
situation where the soybean price was too high for processors to use it profitably, now
the concern was that it might become too low for farrrrers to produce it profitably.

Inordertobreakthermcertainties inthe soybean marketprocessorstookthe
firststeptotransforrnsoybeans fiomafarmsubsistencecroptoacashcropandatthe
same time replaced the farrn-produced meals by manufactured soybean meal feed

1. Staley Company
A founder of the soybean processing industry, August Eugene Staley, started

15
his soybean business in the Corn Belt after WW I. In 1922, Staley began a price

guarantee program, which was to contract with farmers to purchase all the soybeans
they grew. In order to deliver his program, he used public communication channels
and gave numerous talks to farmers, grain elevator operators, seedhouses, county
extension advisers, bankers and news media (Wmdish, 1981). In so doing downstream
actors were able to connect with each other to nurture the soybean industry.

The guarantee program rapidly stimulated interest among farmers. letters from
farmers swarmed in and Staley replied to them by providing his plan. He also
encouraged and refened those interested in soybean culture to the University of
Illinois for the best agronomic advice. VVrth Staley's promotion, during that spring,
Illinois farmers planted 5 times the area to soybeans as in the previous year.

2. Thain torn pomotion program

In 1927, a train torn', entitled 'The Soil and Soybean Special', was the highlight
of Staley’s soybean program The train was equipped with two exhibiting cars, two
motion picture cars, one lecture car and one oflice car. The content of displays and
lectures included information on growing soybeans, utilization of soybean food,
industrial products and the soybean grading system, which were partly provided by the
University of Illinois and government agencies.

This train trip made 105 stops over 2478 miles at towns along the Illinois
Central lines and attracted 33,939 people during the operation Mmdish, 1981). "This
train furnished a visible demonstration and accomplished more in an educational way
than could have been achieved in a year in any other form of agricultural publicity"

16
(W'mdish, 1981: 67).
3. Ernk Bros.

Eugene Funk, with his early experience in selling soybeans at Furrks Bros Seed
Company, became a second soybean processor and a pioneer seedsmarr. The
establishment of a processing plant in 1924 complemented Funk's soybean seed trade.
Farmers contracted to buy and grow varieties released fiom the Universities in Illinois
and Indiana fiom Funk Bros Seed Company and sold soybeans back to Funk's
processing plant (Wmdish, 1981).

4. Peoria program

In order to ensure a profitable market for farmers, in 1928 several processors
co-irritiated the Peoria program, which included Funk Bros, HG. Atwood of the
American Milling Company of Peoria and James A McConnell of G.L.F., professors
from the Agronomy Department of the University of Illinois, county farm advisors, the
Farm Bureau, Prairie Farmer magazine, and the Staley Company. Under the program,
each farmer could underwrite up to 50,000 acres of soybean fields or 1 million bushels
of soybeans with a guaranteed price. In addition, such farmers were not corrrrnitted to
sell soybeans to participating companies if others offered a higher price (\Vrndish,
1981; Lockeretz, 1988).

The Peoria program was rapidly broadcast to farmers and soon its popularity
was reflected by the increasing production of soybeans. The statesmanlike promise of
"You grow the beam and we will find the market" by the National Soybean Processors

Association succeeded in breaking the vicious cycle of uncertainties between farmers'

17
supply and processors' demand, and transformed soybeans from a farm crop to a cash

crop (Riegel, 1944).
5. Tariffs

Although production of domestic soybeans increased after the Peoria Prograrrr,
it could barely compete with cheaper irrrported Manchurian soybeans. The growers'
and processors' groups believed that the United States' farmers could not and should
not compete with the cheap soybeans from the Orient. The chief opposition
encomtered was from soap manufacturers. However, in 1928-29 the ASA
representing processors and growers successfully lobbied for strong tariff protection on
foreign soybean oil and soybean meal. In 1930, import duties were raised to $1.20/bu
for soybeans, $0.03 5/lb. for oil and $6/ton for meal. For comparison, domestic prices
were in the range of $0.50 to $1.30/bu for soybeans, $0.03 to $0.09/lb. for oil, and
$20 to $40/ton for meal (Lockeretz, 1988).

Soybean standank

In 1925, the U. S. Department of Agriculture announced soybean standards for
the purpose of providing a reliable method for various business transactions. Slight
revisions were made in 1926. One change included a super grade to take care of extra
high grade demand such as the seed trade (Reigel, 1944).

In sum, the activities generated by industrial entrepreneurs or groups were
effective in transmitting scientific and technological knowledge, embodying new
technology in equipment and materials, improving the level of husbandry skill, and the
educational accomplishments of nrral people, the efficiency of input and product

18
markets, and the establishment of social and political institutions (Ruttan, 1982). In

other words, the increasing amount of institutions over this period successfully

connected the technical change and social resources for the development of a soybean
industry.

2.2. Period II 1929 -1939

The Great Depression came in the early 19303 and the whole nation's industries
were engulfed in catastrophe. Although the overall economic situation was bad, the
soybean industry steadily accumulated technical advances aimed at market
opportunities in food industries (Forrestal, 1982). In food products, soybean flour was
finally accepted as an ingredient for sausage and the popularity of margarine also
ensured a promising market for soybean oil. Continuous improvements in combines
and processing equipment increased efficiency in production. In addition, the Chicago
Board of Trade provided a futures market opportunity, thereby fostering the input and
soybean product market.

In 1934, Funk Bros. company had a processing plant in operation in
Bloomirrgton which not only crushed soybeans to produce soybean oil and meal, but
also gave soybean meal in exchange for soybeans gown by farmers (\Mndish, 1981).
In the same year, the com in the Corn Belt was destroyed by a chinch bug invasion.
Soybeans were initially advertised as a livestock saver and an emergency crop in order

to continue farm operations. Yet, its role was transfonned from merely a transition

19

crop to a profitable cash crop as a result of the price guarantee progarn.
Processing equipment

The expansion and improvement of the processing industry rmtched the
phenomenal gowth of soybeans. First the old hydraulic presses were replaced by
mechanical expeller and screw presses (Goss, 1944). In 1934, the Archer-Daniels-
Midland (ADM) company installed the first solvent-extraction machine, which
efliciently divided crude oil into ingredients based on the needs of a variety of
industries. This method helped ADM through the economic difficulties of the
Depression (Wmdish, 1981). However, the majority of processors did not use it until
the danger of using a flammable solvent was removed in the early 19503.
Dale W. NkMillen, Central Soya Conpany

Dale W. McMillen, stepped into the soybean industry in 1934 by refurbishing
an old sugar mill as Central Soya Co. at Deeatrn'. McMillen's enterprises were
interwoven with the adoption and exploration of processing technologies. In the
19203, Central Soya Co. was the first to adopt the expeller instead of an hydraulic
press and the second to build a solvent extraction plant in the United States in 1936.
In addition, in 1942, a technical department with a firll-scale biological laboratory was
set up. It produced a nmnber of significant advances such as removing the off-color
and solvent odor from soybean meal (Wmdish, 1981).
I-Emy Ford

The versatility of soybean oil not only appealed to the soybean industry but
also to the auto industry. Henry Ford, with the dream of "growing automobiles on

20
farms", envisioned an immense potential for soybean products in automobiles. His

loyalty to create "a vegetable car" expanded the utilimtion of soybean ingredients to
paint, plastic, margarine, breakfast food, filler for sausage, printing ink, soap and
insecticide (\deish, 1981).
The Bankhead-Jones Act

The promising atmosphere fermented by each actor raised more actors'
interests. In 1935, the Bankhead-Jones Act was passed to intensify research on major
agicultural commodities. As a result, the US. Regional Soybean Industrial Products
Laboratory was established at the University of Illinois to ascertain the efieas of
varietal and cultural difference on the chemical composition of the soybean, to develop
new industrial outlets, and to improve present industrial uses for soybeans as well as
soybean products (Reigel, 1944).
The Chicago Board of Tlade

Since over half of the soybeans were usually sold during the three months of
October, November and December, there was a g'eat need for hedging facilities. In
1936, in response to this need, the Chicago Board of Trade opened the firtures nmrket
to soybeans (ASA, 1958). "The new market in futures will encourage banks to
finance investments in soybean crushing capacity due to greater security through the
opportunity of hedging" (Forrestal, 1982: 103).
Srmll Confirms

In 1939, an affordable and compatible small combine was produced and soon
popularized among small farm owners. Its easy marmgeability not only facilitated farm

21
operations, but also reduced the problems of the scarcity of custom operators during

harvest seasons.

2.3. Period m, w 11 (1939-1945) and Postwar (1946-19703)

WW II (1939-1945)

W H broke out in 1939. When the military invaded the traditional fat and
oil producing countries, such as Norway, South Asian countries and South European
countries, oil deficiency became a worldwide problem. The oil shortage made
soybeans an alternative crop in producing oil and food. Soy flour was incorporated
into military and domestic food products (ASA, 1940). In Germany, the 'Nazi Food
Pill‘ and plastic food were produced by soybean products to serve appropriate calories
and nutrients for troops (Doig, 1943).

Commodity Contracts (Commodity Oedit Corporation)

The rmusual wartime situation legitimated American government intervention in
the soybean industry in order to encourage its continuous gowth. A comprehensive
progarn which regulated the marketing storage, and processing problems of four
oilseed crops —cottonseed, flaxseed, soybean and peanut - was under the control of
the Commodity Credit Corporation, agencies of the Department of Agriculture, the
War Production Board, and the Office of Price Administration. Processors, bean
crushers, and cormtry elevators contracted with the government in order to provide a

fixed price for soybeans, soybean oil and soybean meal to farmers, and to safeguard

22
continuous soybean production (ASA, 1942; Bunnell, 1944). Under this program,

farmers were encouraged to expand the production of soybeans through the price
support program, loans and subsidies (Farrington, 1946).
Grades and Standarrb

The expansion of the soybean industry aroused the need for an adequate
gading standard to stabilize each actors' interactions and mobilize the flow of
soybeans. The first soybean standards were patterned after the gades applying to
cereal gains, and moved soybeans into the gain trade. The standards were revised in
1935 and 1941, and promulgated under the US. Grain Standards Act. However, the
existing measurement of standards including moisture, test weight, color, dockage and
foreigr materials, did not reveal the sigrificarrce of oil content in producing high
quality oil and meal. The first problem occurred during the period of 1942 to 1944.
Soybeansdarnagedasaresultofarrearlyfiostweregradedashigquuality, according
to the existing standard, yet had an oil content below normal, which increased costs to
processors and refiners in the production of quality oil and meals (Iftner, 1943;
Bunnell, 1944).

It became evident that soybeans could not be properly valued by processors
without a determination by chemical analysis of the oil content of soybeans being sold
The unsatisfactory standard led to processors' demand that "soybeans must be treated
asmroflseedraflrerthanagaincropandgadedaccordingly,wiflrpremiums and
discounts for fluctuations above and below a basic oil content" (Brmnell, 1944: 13).

Accordingly, govemment agents, with the cooperation of industries and laboratories,

23
developed analysis techniques for the purpose of relating market prices to the oil

content of soybeans.
Postwar (1946-19703)

After W H, soybeans outgew its infancy and penetrated into farm progams,
edible oil industries, feed manufacture and food manufacture. Soybean processors
strongly encouraged the government to return soybeans to a flee market in order to
enter into an aggessive world marketing progarn and compete with other domestic
vegetable oils (W'mdish, 1981). As a result, soybeans remained free of government
acreage restrictions and other war-tirne controls, such as the commodity processor
contracts and the CCC inventory. The high price support still remained, nmturing the
production of soybeans. However, it raised another concern: srn'plus of soybean
production.

To prevent a soybean surplus, government and industry concentrated efforts on
research projects to expand its market at home and abroad (ASA, 1958; Iflner, 1944).
The soybean successfirlly made gigantic strides in the domestic vegetable oil industry,
and outdistanced cottonseed, flaxseed and peanut, which suffered from econonric
pressures, high cost in production, and unstable production (Eastman, 1945). In
addition, the war-tom countries served as the best opportunity to expand the overseas
rrrarket in the name of relieving the hungry population. Trade missions by the United
States Department of Agiculture, pioneer processors and the American Soybean
Association were sent to Western Europe and Japan to analyze market possibilities.

Several govemment progarns were generated in response to market enlargement

24

(Wmdish, 1981).
Soybean Standards

The rmss production of soybeans did not necessarily ensure a profitable market
opportunity in the competitive global soybean market. It needed complementary
regulations in assisting the mobilization of the commodity at a distinct distance, such
as explicit and mutually acceptable standardization. Dining the 19503, the higher level
of forei gr materials and moisture content of American soybeans led to their poor
showing in the face of Manchurian soybeans on the European market. This was partly
attributed to the incompatibility of domestic standards with those of European buyes.
For example, geen-coated beans were classified as yellow soybeans when mixed with
yellow beans in the US. standard; however, Danish produces strictly excluded green-
coated beans fiom yellow beans because green beans made oil quality unstable.

Inresponsetoachangeinsoybeangadestandards, soybeanactorswere
divided into two goups to negotiate on a new standard In early 1955, gain handlers,
producers and the ASA subnritted a proposal expressing their loss of profit as a result
of the need to clean up the foreigr materials and objected to the exclusion of goer-
coated beans in yellow beans. Simply put, it would add more handling expenses on
the gower side and increase the corrrplexity of handling. On the other side, the Farm
Bureau geneated a proposal for lower foreigr mateials and moisture content, and it
gained support from the Farmers Grain Deales Association of Iowa. Not until
September 1955, was a final resolution reached The new standard for each gade

reduced the level of foreigr mateials, and moisture contert, excluded geen beans and

25
increased oil content. Under the authority of the US. Grain Standards Act, licensed

inspectors in the Fedeal Department of Agiculture were obliged to apply the standard
accurately (ASA, 1955; Shaw, 1956; Daily, 1952; Barr, 1955).

Due to the expansion of soybean markets, the status of soybeans as a main
agicultural commodity has acquired a nationwide attention What remained to finthe
the continuous growth of the soybean industry was the dynamic creation, exploration
and mainterance of the soybean market by various commodity actors. Throughout this
peiod, govenment intervention at each stage of soybean production and processing
was effective in gluing and stabilizing the commodity chain It successfully built a
network which tied the actors together including farmers, agicultural extension agerts,
researchers, agicultural errginees, farm machinery manufacturers, processors, retailers,
politicians, governmert bureaucrats, and consumers.

Reciprocally, the network was effective in producing new knowledge,
modificating and stabilimting the soybean commodity in order to erroll more allies
and to make the network indispensable. The revision of standard and gades well
illustrated how the social network got involved with technical change. The change in
grades and standards was presumably a technieal problem related to measuremerts and
evaluation procedures. Yet, the debate over the changes in measmemert was
constructed and mobilized by actor’s actions in a social context through negotiation,
coe'cion and persuasion, rather than by a simple "objective and static" judgement by
technocrats.

Though the process, the new gades and standards becanre an indispensable

26
point that successfully controlled each actors' behavior and nrade others' actions

predictable. For instance, the standardization of soybean products made purchasing
and selling at a long distance possible. In such a way, actors heavily relied on the
rules of standardization, and "no matter where you go or what you do, you have to
pass through the position, and to help them firrther their interests" (Latour, 1987 : 120).

Thus, the longer the soybean market expanded, the geater the number of actors in the
network who participated in the construction of the fact (Latorn', 1987).

2.4. Period N, Cold War Fra (19703)

Later came the Cold War era. The globalization of soybeans was contingent
on the political and economic expansion of American agiculture into the international
food market. In 1954, the Agicultural Trade and Development Act (Public Law 480)
authorized progams for sale of surplus agicultural stocks and for constructing the free
world as an area for the open flow of goods and foreigr currencies. Under this
authority soybean surpluses would be sold abroad and moved through cornrnecial
channels. The Secretary of Agiculune detemined the countries and the commodities
with whom ageements would be negotiated and financed (ASA, 1958; Humphrey,
1957).

In order to expand the soybean overseas market, seveal complemertary
national policies were launched including the establishment of international research

institutions, food aid progams (F ood-for-Peace Progam), education progams, and

27
bilate'al institutional affiliations.

Intemational soybean research institutes were set up by the cooperation of the
Agicultural Research Service, USDA and the Soybean Council. They were in Israel,
Thailand, France, Italy, Poland, Spain, UK and Japan (Hilbert, 1959). One
educational progam was initiated by the Soybean Council of America in coopeation
with the Great Plains Wheat Market Development Association, the US. Rice Export
Developmert Association, the Milles National Federation, the US. Feed Grain
Council, the Dairy Society International, the National Renderes Association, and the
Institute of American Poultry Industries. The nmin objective of the educational
progam was to teach people how to incorporate the high nutrient value of soybean
products into their diets. The worldwide progam reached 41 cormtries with in excess
of one billion people (Roach, 1961).

The soybean industry faced the fall of the previous food order during the
19703. It resulted from agicultural protectionism in the European countries and the
competition fiom new soybean gowing cormtries such as Brazil (Friedrmnn, 1982).
Since then, the structure of the soybean industry is no longer a mixture of technical
development, nutrient values and economic growth issues as proposed before. On the
other hand, the globalization of the American soybean industry has intetwined
domwtic and forei gr actions, such as food policies, farm proganrs, national economy,
intenatioml order, and capital flows (ASA, 1971).

Gutter3

28

Conclusion

This paper examined the early stages of the soybean industry in the United
States. The introduction of soybeans into US agiculture involved various actors'
participation including developing improved varieties, improving processing facilities
and planting machinery, planting soybeans and marketing soy products and livestock
feed (Lockeretz, 1988). They linked as a network which collectively created the
environmert for the gowth of the soybean industry.

The difiirsion and adoption of innovation literature is focused on the relation
between adopters and the innovations at the farm level. Fanners' socio-psychological
characteristics and the degee of awareress and fiequency of pesonal communication
are factors determining the rate of the adoption of an innovation. However, it is not
my intention to elaborate how the relationship between farmes' socio-psychological
clmracteristics and adopting behavior affected the soybean industry, but rather to
concentrate on the dynamic between off-farm actors and the development of the
soybean industry.

Findings have shown that various communieation methods (e.g., train tour
progarrr, personal contacts...etc.) and education progams (e.g., worldwide progam)
played an important role in distributing information about the meits of soybeans to
farmers and consumers. However, awareness of soybeans is not the key factor to
makeafarmerwanttogow it. Instead, it isthechanges instructurewhichappealto
the actors across the industry, including political, economic, and cultural forces. In

29
other words, without a prospective soybean market ensured by the Peoria progam,

farmers, processors and feed manufacturers would have hesitated to expand their
investmert in soybean production. The insensitivity to contextual and social-structural
factors in diffusion theory could have caused a lack of understanding in the
connections among the farms, the social entities and the development of the industry.

Another problem is its assumption regarding the diffusion of practices as a
succession of steps from birth to commercialization by way of a yisjnertia (Callon,
1989: Latour, 1987). (hoe adoptes accepted a new practice, the yisjnmia of the
new practice would automatically reproduce, move and advance the whole industry
without the actors' activities that slurpe and transform it (Latour, 1987). As a
consequence, we have the soybean on one hand and social actors on the other, both of
them have their own yisjnertia as two separate ertities. However, the practices
employed in developing the soybean fiom a hay crop to an oilseed commodity
involved a spectrum of inteactions distributed across the soybean conrrnodity, so as to
mobilize and coordinate resources for the purpose of advancing the industry.

On the other hand, the induced innovation model assets that technical change
is an endogenous variable driver by economic forces and is induced through the
relative scarcities of factors of production (e. g, land, labor). The changes in
institutions are of necessity to increase an industry's eapacity to manage new
technologies. Findings have shown that the soybean industry has co-evolved with
non-governmertal organizations (e. g, the ASA, the NSPA), govemmert agencies, and

research institutions, which have increased the allocation of social resources and the

30
linkage among scientific communities, farmers and processors‘. This perspective has

provided an advance, connecting social resornces and technical change, over that of
diffusion theory.

However, induced innovation theory does not examine the dynamic between
the establishment of social resources and technical change, which is the key to the
developmert of the soybean industry either. First, the overwhelming reality of
governmental intervention and involvement in the industry has deried the assumption
of a free market mechanism in explaining its developmert. Second, actors concened
with soybeans had diflerent pespectives and interests in innovations deperding on
their expectations of the effects of the innovation and their capacity to appropriate the
potential benefit derived fiom its utilimtion (Pineiro et al., 1979). Since it involved
diverse interests in a society, the final direction taken was a matte of negotiation,
persuasion and coercion among actors (Sousa et al., 1981). The induced innovation
theory does not much deal with the divesion of actors' interests. For instance, a new
gading standard was not induced by a single soybean actor, but rather was a result of
a variety of actors' negotiation and coercion

Third, social, political and cultural mechanisms have sigrifieantly aflected on
the soybean industry. The changes in human diets (e. g., soy flour, margarine, and soy
food), farm practices (e.g., manufactured stock feed) and international politics (e. g.,
WW II and Post War) wee interdeperdert factors in contributing to the rapid

 

4Owing to the availability of data and the purpose of this thesis, the nurnbes of the
institutions which have beer established and their contribution to the soybean industry are not
included

31
expansion of the soybean industry.

On the other hand, actor network theory argues that the development of the
soybean industry is essentially a fact-building process which is collectively constructed
by actors in the soybean commodity subsector. It constitutes a social network that is
able to redefine what it is made of by networking heterogeneous elements (Callon,
1989). One way to understand how the network works is to identify how the
associations were made by actors in mobilizing and linking the social and technical
ertities into developing the soybean industry (Murdoch, 1994).

First, agononrists played the important role of revealing the agonomic
characteistics ofthe soybean to a spectrum of industries, which was to link
heterogenous allies and create the longevity and solidity of the network Dr. Morse
and his disciples first established the ASA, and then constructed the connections
among processors, gowers and govenment agencies.

Second, processing industries successfirlly transformed the soybean into a cash
crop and replaced soybean meal by manufactured stock feed They not only promoted
the expansion of soybean production, but also actively incorporated technical
exploration to increase soybeans' usage (Wmdish, 1981). After WW 11, processors
were actively in cooperation with govenmert to create a soybean market both
domestically and overseas.

Third, the activities of govemmert agents carried out a variety of progams
including production, marketing, processing, industrial uses and consurrrption (Ifirrer,
1944). They included the price support progam, the Bankhead-Jones Act, the

32
extersion service, enforcement of gading standards and progams under the authority

of PL. 480. All of them were to encourage the expansion of soybean production.

Fourth, the improvements in farm machinery and processing techniques
pernitted more efficiency in the utilization of soybeans. For instance, the
development of small combines improved the compatibility and interchangeability of
harvesting machines among wheat, soybeans and com.

Fifth, non-govemmertal associations played an important role in linking
heterogenous resources. For instance, the ASA helped the expansion of soybean
production, assisted in opening overseas markets, and helped in the establishrnert of
the Soybean Council of America, which was a coopeative effort of gowes,
processors and handlers in expanding foreigr outlets. The ASA's official publication,
the W provided a forum to promote the general welfare. Moreover, it
maintained a Washington, DC. staff of two lobbyists and seveal supporting
technicians for urrdetaking policies related to soybeans (I-Ioughtlin, 1961).

The tasks of the National Soybean Processor Association (N SPA) wee to
dictate domestic soybean trading and to set up the NSPA Soybean Research Cormcil
for providing technical assistance. In addition, an advisory board was formed to
distribute soybean knowledge to agicultural teaches, handlers, gowes and the public
(Houghtlirr, 1961).

The development of the soybean industry may be regarded as a process of
interest translation among allies in order to enroll more allies' participation and make

their actions predictable (Latour, 1987) (Figure 1). First, although there wee vesatile

33
agrononric merits of the soybean, researchers concentrated on the soil-building

character of the soybean and translated it as a corn saver in order to cater to farmers'
explicit interest in an alternative crop. In other words, the translation created a tersion
that made farmers select only what, in their own eyes, helped them reach their goals
amongst numy possibilities (Latour, 1987). Second, in order to expand the prospect of
soybeans, processors first reshuffled farmers' interests in soybeans as an economical
farm-produced feed crop, then replaced it by a sauce of cash income. Evertually, the
prototypeofthesoybean industrywasinshapeandbeeameanindispensablepassage
point for the followers. Therefore, a communal fate among actors was built and actors
were controlled by the coordinated industry which was assembled by their inte'ests.

The development of the soybean industry serves as a sigrifieant example of a
planned crop introduction in US agicultural history. This study has shown that the
success of introducing the soybean not only stenrrned fiom its intrinsic meits, but also
involved the participation of various actors to champion and promote the entire
industry. In addition, it consisted of long-tenn dedication of strongly motivated
supporters, early involvement and cooperation of all actors, compatibility of a new
crop with established farming systems, development of locally adapted varieties and
clear standardized gades and definitions (Lockeretz, 1987).

34

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35

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