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October 2008 Archive for Top of Mind

RSS By: Jeanne Bernick, Top Producer

Jeanne, Top Producer Editor, grew up on a beef cattle operation in Southwest Missouri and now writes from the heart of corn country in Eastern Iowa.

Where's the love?

Oct 23, 2008
USDA Secretary Ed Schafer recently stated publicly his support for ethanol plants hurt by high corn prices. The remarks caused the National Cattlemen’s Beef Association (NCBA) to ask “Where’s the love?” for beef producers who have been hurt by high corn prices for some time.
In remarks made in Des Moines, IA on Friday, October 17, Schafer stated that, “There's going to have to be some credit applied to companies to buy some lower-priced corn to blend with their higher-priced corn.These higher corn prices are due in large part to extensive federal subsidies for the ethanol industry. The plants in question hedged on the futures markets and are now seeing the consequences of risky business decisions.” 

In a letter to Secretary Schafer, NCBA stated its disappointment in Schafer’s remarks, and noted that cattle producers, meanwhile, have been facing the hard realities of rising corn prices for quite some time. The industry has suffered a record $1.5 billion in cattle feeding losses in just the first six months of 2008. 
The letter states: “Continuing to subsidize the ethanol industry at the expense of other agricultural sectors risks our food production capacity. While energy independence is an important goal, it must be balanced with one of our strongest suits: our ability to feed Americans and the world.”
The letter goes on to say: “Corn-based ethanol is a mature technology that should be able to compete on the open marketplace without government intervention to prop it up….While we appreciate that the funds in question are not new money or exclusively available to biofuel plants, the ethanol industry’s need for increased funding after years of subsidies highlights an underlying fault in USDA’s approach to food and fuel policy.” 
What are your thoughts? Should the government share the love?

How Biofuels Can Help the UN

Oct 01, 2008
Last week, the CEO of the world’s largest biofuels producer was invited to speak at the United Nations in a private sector forum on their Millenium Development Goals. Jeff Broin, CEO of POET, told UN agency heads why he thinks the biofuels industry model it is applicable to world development goals.
Broin recounted how his father, a farmer who started the 1.4 billion gallon ethanol company 25 years ago, was tired of the U.S. government paying him to set aside productive acres of farmland -- while at the same time, the government was importing more foreign oil every year.
“That didn’t make sense. He saw potential to grow both food and fuel,” Broin said. His father built a small ethanol plant on the family farm and within a couple of years, the Broin family was producing corn-based ethanol. The company grew on a business model based on partnerships with farmers and small communities. “These partnerships have led to tremendous success for our farmers and incredible economic development for these communities,” he said.
Broin is confident that what his father and the POET company have achieved in rural America can happen all over the world.
“With billions of acres of idled cropland across the globe – and the price of agricultural commodities above the cost of production for the first time in decades – there is an unbelievable opportunity for underdeveloped countries to simultaneously lift people out of poverty and solve their crippling addiction to energy imports,” Broin said.
How?? Given all of the advancements in agriculture – new seeds, drought-tolerant crops, smarter farming techniques – people in less than ideal farming situations can grow more sustainable crops than ever before. And it doesn’t have to come at the expense of the environment, Broin said. The billion acres of idled crop land [across the globe] guarantees that new farm land need not come from rainforests or sensitive areas, he said.
To read POET CEO Jeff Broin’s speech to the UN, go to www.poetenergy.com/files/release_files/Jeff-Broin-UN-Remarks.pdf.
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