Corn Growers believe biofuels is good goal, policy for America
On May 31, President George Bush called for a summit to set new goals for reducing greenhouse gas emissions. The same day, the Department of Energy (USDE) announced U.S. crude oil imports have averaged nearly 10.6 million barrels per day for the last four weeks. Those two facts highlight the nation’s need for a move toward renewable, domestic fuels.

Imported oil accounts for 60 percent of the nation’s supply. Renewable fuels, including ethanol from corn and other sources, are necessary if the United States is ever to reduce its dependence on imported oil. Ethanol is already making a difference – record production of biofuels in 2006 reduced oil imports by 170 million barrels. But, undoubtedly, we still have a long way to go.

America’s farmers will continue to do their part. They are meeting the demand for both food and fuel. The demand for corn for livestock feed and human food use has remained steady at about 7.5 billion bushels per year for the last decade. U.S. growers have harvested an average of 10.9 billion bushels in the last four years, allowing that additional supply to be used for producing ethanol. There simply is no conflict between producing corn for food needs and producing corn for biofuels. Recent increases in the price of corn have had little impact on food prices.

In fact, the value of all raw food ingredients (including grains) accounts for less than 20 cents of each dollar an American consumer spends on food. Even at $4 per bushel, the amount of corn represented in a pound of pork comes out to about 17 cents. Other factors involved in food costs, such as labor (38 percent of the total cost), transportation and packaging have a more profound impact on retail food prices.

How can corn producers continue to supply both the food and growing fuel industries? By growing more corn. This year more acres will be planted to corn since World War II.

While corn acres expand, the amount of corn grown on one acre continues to increase. Availability of better corn hybrids from enhanced genetics and improved breeding processes have helped corn growers raise average yields from 88 bushels per acre just 30 years ago to 149 bushels in 2006.

The National Corn Growers Assoc. has repeatedly said it believes the nation’s corn growers can produce enough to supply 15 billion gallons of ethanol (roughly 10 percent of our gasoline supply) by the year 2015 without significant impact on other corn markets. In fact, the USDA recently concluded that, after increasing slightly higher than the overall rate of inflation, food prices will stabilize after the year 2010 and then increase at a rate less than overall inflation.

It is important to remember producing ethanol from corn does not mean less protein or fat will be available to the feed and food chain. Only the starch portion of the kernel is converted to ethanol, while the protein, fat and other nutrients are concentrated and passed through to a coproduct known as distillers grains. These residual grains are fed to livestock and poultry and often replace corn in feed rations.

No serious proponent of renewable fuels will argue that U.S. corn can supply the nation’s energy needs alone. Corn ethanol is just one important piece of a broad-based, multipronged domestic energy program that helps alleviate dependence on foreign oil. Both USDE and USDA are driving research into more efficient methods of producing ethanol from cellulosic materials like wood chips, municipal solid waste and agricultural residues. NCGA and other farm groups are solidly behind the development of cellulosic ethanol production.

Ethanol not only reduces our dependence on oil, it also benefits our rural areas by providing a significant economic boost to small communities across the country. The more than 110 ethanol plants that now dot the rural landscape have created thousands of good-paying jobs and boundless opportunities for rural Americans to share in the profits of producing energy.

In fact, farmers and other small rural investors own roughly 40 percent of the ethanol plants in operation today.

The United States needs both a policy and a domestic source to help fill its ever-increasing energy needs. Relying on the “free market” and foreign control of our fuels has served us poorly over the last three decades. Renewable fuels, produced by this nation’s farmers, are a vital component of a long-term, environmentally acceptable solution.

-Ken McCauley
President,
National Corn Growers Assoc.