PENDLETON - Cereal experts encouraged farmers to develop an oilseed industry in the region at Tuesday's Columbia Basin Cereal Seminar.

Nearly 70 people crowded into the Oregon State University Extension Service conference room to hear scientist Don Wysocki, farmer Kent Madison and businessman Al Gosiak talk about canola and biodiesel.

Wysocki, a soil scientist at the Columbia Basin Agricultural Research Center near Adams, said as area farmers and businesses develop an oilseed industry, the biofuel and other industries related to oilseed byproducts will spring up as well.

"Biofuel is the product with the lowest value from these crops," he said.

Why should farmers consider planting canola now?, someone in the crowd asked.

Wysocki said since the U.S. Food and Drug Administration approved canola oil in 1985, it has replaced 20-30 percent of the nation's vegetable oil market.

"This biofuel thing is driving it right now," Wysocki said, "but there's a demand for vegetable oils for human consumption."

Canola oil is healthier, Wysocki said, because it's the only "major oil" that contains one percent or more Omega-3 fatty acids. It's among the fatty acids that are essential to human health, but must be obtained from food.

Another participant asked Wysocki about Canadian growers' production advantages.

Wysocki said the Canadians have 50 years experience in breeding and agronomy and have developed a canola crop that yields equal to wheat. In this region, he said, canola yields are just 80 percent of wheat yields.

"We're behind," he said. "Can we push our yields to one-to-one? Yeah, I think we can."

Madison, an Echo farmer who grows irrigated canola and produces biodiesel to fuel his farm vehicles, said canola uses little water. Because water on his farm is expensive, and limited, he finds canola to be an ideal crop. His yields have been 3,000 to 3,400 pounds of canola seed per acre.

His cost has been $341 per acre, he said, including $125 in land costs.

That's a turn-around from the pre-biodiesel days, he said, when he lost $85 per acre growing canola. But that was better than allowing the ground to sit idle and losing $125 per acre, he added.

With canola seed selling for 12 cents per pound, as it did last year, he's making $19.20 per acre, which was a $105-per-acre change.

"We need 4,000-pound canola," Madison said. "We're putting the heat on Don Wysocki."

A 4,000-pound yield would return $139 per acre, Madison said.

"That's what we're hoping the plant breeders can get us to," he said, adding that even the higher yield makes growing the crop risky at 12 cents per pound.

That's why Madison and others are hoping to get the price to 14 cents per pound, which would return $220 per acre profit.

Pilot Rock farmer Bill Etter said the seminar provided him with valuable information.

"I've grown a little bit in the past," he said of canola. "We could possibly in the future. I'm just looking at alternative crops."

But farmer Jeff O'Harra of Weston isn't so sure he'll grow it again.

"My decision will be based on economic factors," he said. "At the current price of canola, I don't think it's economically viable."

Madison unveiled the new Oregon Grown Biodiesel logo, which producers are hoping can be put on pumps in the Portland area that deliver the home-grown fuel.

"We're branding our product to the end consumer," Wysocki said, adding that all diesel sold in Portland by July must be 5 percent biodiesel, or B5, and by July of 2010, it must be 7 percent biodiesel.

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