Ethanol threatens food supply chain

The ethanol industry is mandated, subsidized, tax abated and tariff protected. No other industry finds such a generous government.

Because of our ethanol policy, the price of corn has skyrocketed, jeopardizing the financial health of the entire livestock and poultry industry. Because of that policy, many livestock and poultry producers have closed their doors. Some have gone bankrupt. In 2008 one of the largest chicken processors in the United States filed for bankruptcy because of increased production costs.

Nearly 70 percent of the cost of raising a hog is for corn and soybean meal. Corn has gone from $2.50 to $8 a bushel recently because of ethanol. Today, we have the highest beef and pork prices on record. Yet because of feed costs, there is limited profit for livestock producers.

Adverse effects from ethanol at the grocery store are showing up on the balance sheet of the national treasury. With meat prices off the chart, the number of people on food stamps has gone from 26 million in 2007 to 44 million today. The cost to the national treasury has risen from $33 billion to $77 billion.

Worse still, Mother Hubbard's corn cupboard is running low. Projections are that we will have about a three-week supply of corn at the end of this marketing year -- Oct. 1. That is about as low as it has ever been.

Of greater concern is that the 2011 corn crop is off to a rather dismal start in this part of the country. Depending on Mother Nature, it is not out of the realm of possibility that we will not have enough corn in the Eastern Corn Belt to make it to the 2012 harvest.

If that would happen, you might have enough mandated ethanol for your fuel tank but not enough corn for livestock and poultry feed to put scarce and high priced meat, milk, and eggs on your table.

Our farm has produced market hogs for 105 years. Livestock sales provide more than 90 percent of our gross income. When we buy corn to feed our hogs, we are competing against tax-supported ethanol plants. There is no government mandate that Americans consume bacon and pork chops.

It is time to rewrite our ethanol policy. If ethanol has a future, let it compete in the market place absent mandates, subsidies, tax abatements, and tariff protection.

source: thestarpress