Ethanol Can't Meet All Our Alternative Fuel Needs

US - Seven years ago, there were 54 ethanol plants in America, with a production capacity of 1.7 billion gallons per year. Today, there are 119 plants nationwide, with another 86 under construction or being expanded. Annual production capacity could top 10 billion gallons next year.
calendar icon 27 July 2007
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No matter how you crunch the numbers, that's extraordinary growth for an industry that's become the rising star in our national quest to "go green" with biofuels. Minnesota is right in the thick of things, with 20 corn-based plants in operation and more in the planning stage.

But there's a reckoning ahead.

For decades, as better machinery, plant genetics and herbicides increased corn yields, farmers didn't exactly cash in. Increasing supply while demand remained largely stagnant kept corn prices in the neighborhood of $2 per bushel as recently as December 2005.

Thirteen months later, fueled by the ethanol market, prices topped $4, and farmers responded this year by planting nearly 93 million acres of corn, the most since 1944. Land values and cash rental rates for farmland are soaring, and many small communities near ethanol plants are experiencing an unprecedented economic boom.

Some farmers, however, are feeling a financial pinch, and therein lies the problem. Beef cattle, dairy cattle, hogs, turkeys and chickens eat corn -- as well as hay, soybeans and other agricultural products that are being squeezed off land in favor of corn.

It takes time, but rising feed costs eventually translate into higher prices at the supermarket. Milk is a prime example, with some analysts predicting prices of $5 per gallon by September. Beef, pork and poultry prices aren't rising quite as rapidly, but they'll catch up. The corn needed to produce a market-ready hog today costs $20 more than it did three years ago, and a portion of that cost, if not all of it, eventually will be passed on to consumers.

Source: Post-Bulletin
The Emerging Threat Of Ethanol

Each year the world's dependance on energy grows and every second of it our energy sources are being depleted. The future is bio-diesel, only it has arrived too soon. The prescense of corn is beginning to dominate the farmers market as it's value sky-rockets. But what effects is this having on animal producers? Get the lo-down on the debate by clicking on our previous news items below.

2007-07-13 Synergy Between Livestock Producers and Ethanol Plants Needed
2007-07-10 Corn Prices Have Small Impact on Higher Food Costs, says AFB
2007-07-05 Growing bio-fuel demand underpinning higher agriculture prices
2007-07-02 Ethanol Co-Products: A Livestock Dish Of The Day
2007-06-25 Cattle Producers Urge Equal Opportunity Energy Policy
2007-06-15 NFU: Demand For Land To Remain Strong As Corn Fares Better Than Horn
2007-06-12 AMI Launch Web Site Calling for Balanced Food and Fuel Policy
2007-05-18 Study: Ethanol raises food costs

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