Published on: 20:58PM Jul 19, 2009
After losing a record $5.2 billion in equity since January 2008 due to high feed costs and economic factors that have crushed beef demand, the beef industry is fighting mad at ethanol.
“Soaring feed costs and government payments to the ethanol industry are hurting small businesses and family ranches,” says National Cattlemen’s Beef Association (NCBA) president Gary Voogt. “Cattle producers don’t ask for subsidies, just equal footing.”
So the National Cattlemen’s Beef Association is commending Representatives Joseph Crowley (D-NY) and Mary Bono Mack (R-CA) for introducing the Affordable Food and Fuel for America Act, which will phase out government support for corn-based ethanol over five years. The American Meat Institute, the Balanced Food and Fuel Coalition, and the Grocery Manufacturers Association also support the bill introduced into the House of Representatives.
“After 30 years of support, corn-based ethanol is still reliant on government support to be commercially viable,” says Voogt. “It is time to allow it to compete on a level playing field, and to stop propping up one industry at the expense of another.”
While there is no question higher feed prices are putting a financial squeeze on the livestock industry, lets not forget that over the last number of years, corn prices have been substantially below the cost of production, and the livestock industry has benefited from this.
The ultimate goal of the ethanol industry over the next few years is to switch from primarily corn to cellulose for ethanol production. But until technology and markets bring that change, it’s likely that livestock farmers will continue facing challenging times.