Ethanol Subsidy Makes Livestock Feeding Tougher On Dairy Producers

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The Merced Sun-Star reports dairy farmers who have seen milk prices fall are struggling even more as corn they would use for feed is going towards ethanol.

Dairy farmers have made watching commodities markets part of their daily work schedule. Michael Marsh, chief executive officer of Western United Dairymen says the price of milk isn’t bad, but the higher cost dairy producers are paying for feed is what’s killing them.

"If our feed costs were at somewhere near normal levels, most of the producers would be cash-flowing today," Marsh said.

Corn prices have excelled due to ethanol, its use in fuel rather than food has led livestock producers to find other feed options or pay the higher price. Dairy farmers and other livestock producers are pushing for the end of ethanol subsidies which expire December 31, unless they’re renewed.

If the subsidy is renewed, more dairy farmers face the threat of going out of business. According to Marsh, 14 percent of dairy producers went out of business in 2009.

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