US livestock producers issue plea over ethanol

Beef Central, 31/07/2012


National Cattlemen's Beef Association president JD Alexander.US meat protein producers dependent on corn as a feed source for their stock have issued a plea to Washington for a waiver over current mandates on corn-based ethanol production.

The North American Meat Association says economic disaster conditions caused by the worsening drought across the US prompted the establishment of a coalition of meat and poultry organisations, to petition the US Environmental Protection Agency to waive current corn ethanol mandates.

“This relief is desperately needed because US agriculture faces the worst drought in at least 50 years and corn yields are expected to be significantly less than originally predicted,” the NAMA said this morning.

Nebraska cattleman and National Cattlemen’s Beef Association president J.D. Alexander, speaking during a coalition media conference in the US this morning, said in his own feeding operations he “just couldn’t make the numbers work.”

“We can't find corn, so as a direct result, we're cutting back,” he said.

Prospects for the US corn harvest had changed dramatically since Mr Alexander paid a visit to Australia in May for the Beef 2012 event in Rockhampton, at which time crop prospects still looked bright.


Monday’s weekly crop progress report from the US Department of Agriculture again showed deteriorating corn and soybean conditions that are now rivaling the worst on record.
Only 24pc of the US corn crop was estimated to be in good or excellent condition. That
compares with 62pc this time last year and 26pc last week. This week’s figure is
the second lowest on record — exceeded only in 1988.
On the other end of the spectrum, 48pc of corn acres were rated in poor or very
poor condition. That compares to only 14pc this time last year.

National Pork Producers Council president Randy Spronk told the media briefing his members were extremely worried about access to feed for their animals, given the drought affecting much of the corn-growing region.

In a petition delivered to EPA administrator Lisa Jackson yesterday, the livestock producer coalition asked for a waiver of the amount of renewable fuel that must be produced under the US’s Renewable Fuels Standard (RFS).

The RFS requires 13.2 billion gallons of corn-based ethanol to be produced in 2012 and 13.8 billion gallons in 2013. These targets will use 4.7 billion and 4.9 billion bushels of corn, respectively.

Some agricultural forecasters now estimated that just 11.8 billion bushels of corn would be harvested in the US this year, meaning corn-based ethanol production would use about four out of every ten bushels produced, NAMA said.

“As a result of this, the supply and cost of feed will be affected for every major agricultural sector of this country.”

Last Friday, in a Wall Street Journal opinion piece, Smithfield Foods chief executive Larry Pope pointed out that “Ironically, if the ethanol mandate did not exist, even this year's drought-depleted US corn crop would have been more than enough to meet the requirements for livestock feed and food production at decent prices.”

Mr Pope's article can be read online here.


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