A Cost-Differential Analysis of Local Soybean Processing in East Tennessee: Roast or Crush?

East Tennessee soybean producers currently have limited local markets and processing options. Most soybeans produced in the region are transported for processing or export to Guntersville or Decatur, Alabama. High transportation costs cut into profit margins and limit local economic impact. With the demand for processed soybeans from the local beef and dairy industries, local processing technology options ought to be investigated. This study will assist soybean farmers in decision-making between hauling to current processing plants or seeking out alternative local processing. Local processing points could allow local beef and dairy farmers additional options of including processed soybeans in least-cost livestock rations. Through capital budgeting and linear programming methods, the derived demand for processed soybean products and the optimal location of a local processor under multiple scenarios were determined. The local soybean processors in the Sweetwater and Greeneville sub-regions were estimated to provide cost-savings compared to the current system of transporting soybeans to the existing processing plant in Guntersville, Alabama for East Tennessee soybean producers and cattle producers.