Ranchers, farmers battle over corn

Discussing an ongoing battle, corn has spiked due to the Ethanol battle from $2.50 a bushel to over $4.00 earlier in the year. On Tuesday corn delivery was at $3.12. The higher corn prices are leading to higher feed costs for many farm animals. The prices are also leading to less grazing land and higher costs for land as it is being converted to acres to corn. Where is the feed going to come from and what is going to happen to our competitive position internationally? These are among many questions that are being asked by Jesse Sevcik of the American Meat Institute as she notes that the livestock sector is losing its position to ethanol as the main consumer of U.S. corn. According to the Renewable Fuels Association, more then 120 ethanol plants are now in operation and 76 more are being built or expanded.

Cattle producers can use a variety of feeds, but other things like soybean and hay have also risen as farmers are using more land for there corn. Several other prices are higher due to the corn increase. Milk prices are up 10% from January, beef and pork prices are up 5%, and poultry are up 6.5% according to the Labor Department’s consumer price index. For pork and poultry producers, “an increase to $4 from $2 in the price of a bushel of corn and a jump from $120 to $260 per metric ton of soybeans translates into roughly a 30% increase” says Michael Swanson, an agricultural economist at Wells Fargo. For consumers, meat, milk, poultry and eggs make up about 20% of a families food budget. Also Cereals and grains account for 8%.

A website sponsored by cattle, beef, dairy, poultry and egg producers focuses on the side effects of the booming ethanol market. I encourage everyone to look at the website and read the articles because it is very interesting.

balancedfoodandfuel.org