Corn on the Hoof: Cattle producers keep close eye on farm bill

US - What's the price of corn? When the 2007 Farm Bill clears Congress this year, the answer to that question may be the key element to the voluminous document.
calendar icon 27 March 2007
clock icon 2 minute read
And not just for farmers.

The price of cattle at all stages depends on the price of corn, which is the basic ration for raising cattle to produce beef.

So this year, the energy component in the Farm Bill will determine the price of cows and beef. Also, pork and chicken and maybe even corn flakes.

A survey of cattle producers from Wi-baux to Dillon, however, points to several other issues that ranchers would like to see, or not see, in the nation's agricultural blueprint for the next five years.

Ethanol shifts equation

"This is a new scenario with corn and ethanol," said David Hagenbarth of Dillon. "The ethanol bubble will burst because it is not a high-level fuel. The fuel problem is from our obsessive use of automobiles. We have to solve that separately."

With corn prices hovering around $4 a bushel, or about double the price of a year ago, cattle feeders have been forced to look for substitutes.

One major aspect of previous farm laws is that farmers producing corn and other grains have received subsidies and price supports because commodity prices were low. However, in the past couple of years the increased use of corn to produce ethanol as a fuel additive and substitute has driven up the crop's price. And that, in turn, pulled other grains with it, especially barley, which is a good ration for feeding cattle.

The farm bill has had a direct effect on cattle feeders because it provides the basis for inexpensive cattle feed.

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