NPPC Details Ethanol Concerns To Energy Group

WASHINGTON, D.C. - Despite criticism from some corners, the National Pork Producers Council continues to express its concerns about the adverse affects on pork producers of the rapid expansion of the corn-based ethanol industry, yesterday outlining its apprehensions at an energy meeting sponsored by the 25x’25 Alliance.
calendar icon 24 March 2007
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The goal of the group of mostly agriculture organizations is to get 25 percent of the nation’s energy from renewable resources such as wind, solar and bio-fuels by 2025.

NPPC, at the alliance’s third national 25x‘25 renewable energy summit, raised the issue of corn availability for livestock feed, pointing out that the ethanol industry is projected to use more than 5 billion bushels of corn once ethanol plants now under construction come online. The U.S. produced 10.75 billion bushels of corn last year, with the livestock industry using more than 6 billion bushels. More than 1.3 billion bushels were processed for food and industrial uses, and about 2 billion bushels were exported.

“Pork producers continue to have the jitters over the rapid expansion of the corn-based ethanol industry and the challenges that expansion presents to maintaining our competitiveness with domestic and international meat protein competitors,” Joy Philippi, immediate past president of NPPC and a producer from Bruning, Neb., said at the energy summit. “Additionally, we are concerned about not having an adequate transition period to adjust to the rapid expansion of the ethanol industry.”

Also, said NPPC, the high demand for corn has pushed the per-bushel price up to $4 from $2 last summer, raising pork producers’ feed input costs to $65 per pig from $35. With that increase, pork production may need to decline by as much as 15 percent to allow the industry to recoup higher production costs, according to a November 2006 study by Iowa State University’s Center for Agricultural and Rural Development. CARD also estimates that a 30 percent production-cost increase will raise retail prices for pork, beef, dairy and chicken by 7.5 percent.

Corn availability and price concerns prompted pork producers at NPPC’s early March annual business meeting to approve several resolutions related to ethanol, including supporting the incremental early release – without penalty –of Conservation Reserve Program acres back into crop land to boost corn production and allowing the 51-cent per gallon ethanol blender’s tax credit and the 54-cent tariff on imported ethanol to expire. The blender’s credit is set to expire Dec. 31, 2010; the import tariff Dec. 31, 2008.

Philippi told the energy summit meeting: “Pork producers believe that to maintain a healthy rural economy – indeed a healthy economy in general – market-based bio-fuels policies and regulations must ensure a balance between the food, fuel and feed needs of the country.”

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