High Feed Prices: Livestock and Poultry Leaders plead case to Congress

Last week leaders from the U.S. Livestock and Poultry Industry met with the House of Representatives Ag Committee chaired by Rep. Thomas Rooney on the concerns about tight feed grain supply.  Following are some of their comments. Phillip Greene, Vice President – Foster Poultry Farms Fresno California – appearing on behalf of American Feed Industry Association. *Return agricultural commodity markets to operations driven by market demand by re working Federal energy policy to remove the mandated use of food commodities from the list of eligible feed stocks for federal assistance in bio energy development.  Absent that, ensure there is mechanisms in place which require the Secretary of Agriculture to waive the RFS (Renewable Fuel Standard) in the event stocks – to – use ratios below a prescribed amount or prices hit specified levels. *Reinvent the CRP and government acreage – idling programs to ensure such programs do not provide an economic incentive take much – needed non – environmentally sensitive arable acres out of production. Ted Seger President Farbest Foods Inc on behalf of National Turkey Federation comments: *Limited acreage expansion capability for corn production together with the expanded RFS (Renewable Fuel Standard) has driven net feed supplies and stocks available for uses other than ethanol to critically low levels.  In light of the realities of grain supply and demand, Congress should re – evaluate the corn based RFS schedule for 2012 through 2015.  A fair and balanced approach for the overall good of the U.S. economy would give increased weight to food production and food security, and less weight to bio fuel production.  The Volumetric Ethanol Excise Tax Credit (VEETC), or blender credit, is not required to support ethanol production and should simply go away at the end of the year. “If we as a country are truly interested in reducing our dependence on foreign oil, then please tell me why the ethanol industry will be allowed to export nearly 1.0 billion gallons of ethanol.  Why are the U.S. taxpayers subsidizing another country’s dependence on oil?” Michael Welch – President and CEO Harrison Poultry on behalf of the National Chicken Council *Elimination of the Volumetric Ethanol Excise Tax Credit (VEETC) and import duty on ethanol. *Have a partial or full waiver of the Renewable Fuel Standards (RFS) by filing a legal challenge with the Environmental Protection Agency or have legislation passed to permit individual states to opt out of the federal ethanol mandate and/or legislation mandating a stocks to use trigger mechanism for the RFS. Minimize or prohibit further government subsidies and federal grants funding the building and expansion of infrastructure that encourages the manufacturing, distribution, and selling of corn based ethanol. *Remove without penalty non environmentally sensitive cropland from the U.S.D.A.’s Conservative Reserve Program (CRP). There were other speakers including Dairy, Beef, and Swine (NPPC), but the previous recommendations clearly pick up what the Congressional Committee heard over and over.

Our Summary from the Speakers

            *Mandated ethanol use using corn is dumb. *Stop subsidizing corn for ethanol in any which way possible *How dumb is it for American taxpayers to subsidize corn ethanol for export? *Stop paying farmers to keep cropland from having crops? *Any plan is good that cripples corn ethanol production.  Allow individual state opt outs from mandates. The different speakers were consistent.  The only thing they left out was burning our food is INSANE! Corn ethanol has created DDG’s – the cursed by product.  With DDG’s and we quote NPPC testimony at the Congressional hearing: ‘There are several issues with feeding DDG’s to pigs.  They are inconsistent from ethanol plant to ethanol plant to ethanol plant, and even within a plant.  There is variability in their nutrient content – protein, fat, and phosphorous.  If the fermentation or drying process for DDG’s is changed or varies from batch to batch, it can have impact on the digestibility of nutrients.  Additionally, corn can contain mycotoxins that are in some instances detrimental to pig performance.  The presence of mycotoxins varies by growing season, location and environmental factors.  Since the ethanol production process removes the starch (two thirds of the volume) from corn, DDG’s from mycotoxin – contaminated corn will have three times the level of mycotoxin that was present in the corn itself.  Depending on the percentage of DDG’s fed and which toxins are present, pigs can experience multiple problems, including immune challenges, abortion, and feed refusal. This is a severe limit on the widespread use of DDG’s in gestation and lactation diets.  (Corn ethanol ‘the gift that keeps on giving!’). “As pigs are fed increasing levels of DDGs, the corn oil present (also three times the concentration as in corn grain) can increase the iodine value, leading to soft fat of the carcass.  This can result in belly slicing problems and possible rancidity or shelf life issues.  A higher percentage of DDGs in the diet can also have a negative effect on carcass weights, most likely because of the increased fiber content of the DDGs.” Couple DDGs with Genetic products that include Pietran (compared to Durocs) and you have high iodine levels.  Soft fat rancidity or shelf life issues are not how we build domestic or export demand.  Packers are now measuring iodine levels.  Some are discounting high levels.  Why?  Product quality is important.  It is no wonder the largest packer integrator uses almost exclusively Durocs?


            Corn ethanol has driven our costs higher – DDGs have hurt our product quality when coupled with inferior Pietran Genetics.  It is good to see all Livestock – Poultry groups united to fight the corn ethanol insanity.  Let’s hope Congress is listening.

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