News last update:6 Aug 2012

Bush's plan impacts US farmers

President Bush's plan to power up ethanol production is raising red flags among the nation's poultry and pig producers. They worry that rapidly increasing the ethanol production will further push up prices for corn, the main animal feed grain.

"We estimate that ethanol demand has already increased the price of chicken by six cents per pound wholesale," said the National Chicken Council's chief economist William P. Roenigk. "If government continues to push corn out of livestock and poultry feed and into the energy supply, the cost of producing food will only increase."

Concerns from the pig industry
"The National Pork Producers Council supports the president's goals of energy security and independence through the development of a vibrant and robust domestic renewable fuels market. However, the pork industry has concerns about the rapid growth in the renewable sector, including increased feed input costs, the availability of corn, the ability to use ethanol by-products and the time it will take for feedgrain markets to stabilize. Producers applaud the administration for adopting a 'circuit breaker' to guard against unforeseen circumstances such as a drought, and we urge the Secretary of Agriculture to establish a working group within USDA to study the emerging biofuels economy and its implications for producers, the livestock sector and the consumers they supply and serve."

Study the impact
The Chicken Council and other groups including the National Milk Producers Federation, American Meat Institute, the National Cattlemen's Beef Association, the National Pork Producers Council and the National Turkey Federation, wrote a letter this week to Agriculture Secretary Mike Johanns asking him to set up a working group to study the impact biofuels will have on food producers. "Given that corn prices are the major feed input cost for dairy cows, and that corn is expected to reach record prices levels in 2007, the USDA needs to do more homework on the implications of the ethanol gold rush on milk and meat costs," Jerry Kozak, president and CEO of NMPF, said in a statement.

The Bush plan calls for a 20% cut in gasoline consumption over the next 10 years, largely through an enormous boost in federal mandates for ethanol and other renewable fuels to 35 billion gallons by 2017.

Related link:
State of the Union (energy initiatives)

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