Bean Smart

Bird Island – From fuel to folic acid, navy bean growers are looking for ways to gain more value than they now get from a can of beans.

The Bird Island Bean Company is scouring the country for new navy bean markets – especially for low-value culls – beans that are damaged or don’t make the grade during processing. The south central Minnesota bean company is not alone. Surpluses and low prices are spurring an industry-wide push to find new food and manufacturing uses for abundant dry edible beans.

Bird Island Bean Company operates one of the few navy bean handling facilities in central Minnesota. The company buys, cleans and ships beans, and also provides crop inputs and agronomy and marketing services. The venture began in 2000, after a major ag processor decided to mothball the 1969 facility. Willmar-area navy bean growers Duane and Nate Hultgren and Curt Meyer, along with plant manager Larry Serbus, bought the plant, which serves about 250 central Minnesota navy bean producers.

“We took on the plant because we had a good grower base, and the farmers needed us,” says Serbus, 52, who has been in the dry edible bean business for more than 30 years. The Renville County plant is located in one of the top-yielding regions in the country for navy beans. And though dry bean prices are volatile, per-acre returns compare well with other row crops, Serbus says. However, “there are only a couple of other outlets in the area for navy beans. We felt the farmers were interested in keeping us here.”

Demand stagnant

Bird Island Bean, which last year posted sales of $1.5 million, ships dry beans around the region, marketing through ConAgra. Although it is small, the facility has some important competitive advantages, Serbus says. It is located near several large canning plants, which cuts transportation expense as much as $1 a hundredweight – a significant savings.

Also, the facility has enough warehouse space to store an entire year’s production, allowing farmers to take advantage of periodic price spikes. Bird Island’s storage capacity is a benefit for processors, too, Serbus adds. “We can put 120 semi-loads of beans on the floor and have them ready to go to the canners at a moment’s notice.”

At the same time, though, Bird Island Bean Company faces strong competition from larger handlers in the Red River Valley, says Nate Hultgren, the company’s financial officer. And industry trends are adding to the competitive pressure. Demand for navy beans – used mainly in canned baked beans – is stagnant at about six million hundredweight a year. Meanwhile, surplus domestic stocks and foreign imports tend to weigh on navy bean prices, which are not supported by federal farm subsidies.

All these pressures led Bird Island Bean to AURI, seeking ideas about how to boost demand for navy beans.

Culling ideas

The company was especially interested in finding new outlets for broken or damaged beans, which amount to about five percent of annual production. Culls are unsuitable for canning and are usually sold as livestock feed, bringing $40 to $60 a ton. “Culls were the first area we looked at to bring in more revenue,” Hultgren says.

Al Doering, technical service specialist at AURI’s Waseca coproducts lab, helped Hultgren investigate a variety of potential manufacturing uses for culls. “We looked at all kinds of things, from adhesives and absorbents to pellet fuels for home heating stoves,” Doering says.

Pellet fuels appear to be one of the most promising new uses for navy bean culls, Doering and Hultgren say. Dry beans produce a lot of heat energy with relatively low amounts of ash, according to a 2002 AURI study, which calculated the heat values of dozens of ag-based fuels, including navy beans. “Dry edible beans looked very good” as a biomass fuel, Doering says, “comparable to corn.” (A complete list of Btu comparisons is available at www.auri.org)

Demand for pellet fuels has more than doubled in the last five years, to about 680,000 tons a year, according to the Pellet Fuels Institute. Most pellet fuels are made from waste wood or sawdust, but there is growing interest in using other renewable fuel sources, too, Doering says. AURI is now working with a half-dozen Minnesota companies to commercialize pellet fuels made from the state’s ample supplies of beet pulp, distillers dried grain and other low-cost ag coproducts.

‘Bean-y’ taste a challenge

In addition to industrial uses, AURI also helped Bird Island Bean Company take a preliminary look at potential new food uses for navy beans.

These small white beans pack a whole lot of nutrition, offering high protein and low fat, plus plenty of fiber, folic acid and calcium. Navy beans could someday find their way into high-protein extruded snacks or breakfast foods, says AURI cereal scientist Charan Wadhawan. They could also be separated into components to make protein and starch concentrates for processed products such as baby food and bread. Nutraceutical opportunities are discussed in a 2003 AURI report on functional traits in Minnesota grains. (See accompanying story, page 5)

But Wadhawan notes that dry beans present two big challenges for food makers: a distinct “bean-y” flavor or smell and a tendency to produce flatulence.

“We’re probably years away from new bean products,” says Nate Hultgren, 26, who has a degree in finance from the University of Minnesota and raises sugar beets, corn, soybeans and navy beans in Kandiyohi County with his father, Duane. But Bird Island Bean Company is looking towards the future, he says. “We’re trying to develop relationships now with people who want to try new things. We’re not limiting our thinking.”

Finding the golden egg

Bird Island Bean’s efforts are just one example of an industry-wide surge of interest in new uses for dry beans, says Tim Cournyea of Northarvest Bean Growers Association, based in Frazee, Minn. The commodity group represents dry bean producers in Minnesota and North Dakota. The two states lead the nation in the production of pinto, navy and dark red kidney beans.

In the 1970s, when the region first began expanding dry bean production, the industry funded research on separating beans into components for use in flour, pasta and other food products, says Cournyea, who has been with Northarvest since 1976. Those early efforts at adding value foundered, he says, partly because dry beans were too expensive.

As acreage and productivity rose in the 1980s and 1990s, commodity prices fell sharply, spurring renewed efforts to lift demand. “Five years ago, there was very little going on,” Cournyea says. “But now, everybody is looking at the health and nutritional benefits of dry beans and exploring alternative ways of using them.”

Taking a cue from American corn growers, who have charted a national vision for a carbohydrate economy based on corn, Northarvest growers are developing a similar vision for the dry bean industry, Cournyea says.

Over the next year, for example, the association will hold conferences on the most promising ways to use dry beans in health foods, pharmaceutical products and industrial goods. These conferences are the first step in creating a long-range plan to guide research, new product development and promotion. Cournyea says, “We need to have an appropriate agenda showing where we’d like to go.”

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