The National Cattlemen’s Beef Association questions the Obama Administration’s commitment to U.S. livestock producers’ quest to sustain their family operations. The concerns issued by NCBA come subsequent to today’s announcement made by the Environmental Protection Agency (EPA) to introduce ethanol-gasoline blends of up to 15 percent by volume, commonly known as E15. According to NCBA, EPA’s approval of Growth Energy’s petition to allow the use of E15 in vehicles made since 2007 is yet another example of adding financial burdens to all users of corn. Permitting E15 represents a 50 percent increase from the currently permitted level of 10 percent ethanol.
“Corn ethanol production is significant to the cattle industry because of its impact on feed grain prices. NCBA’s members strongly oppose mandated production and increasing government intervention that artificially inflates the cost of feed ingredients. This waiver is a step closer to more government mandates," said Foglesong. “From December 2007 to February 2010, the cattle feeding sector of the beef industry lost a record $7 billion in equity due to high feed costs and economic factors that have negatively affected beef demand. Between 2005 and 2008, corn prices quadrupled, reaching a record high of more than $8 a bushel.”
According to the United States Department of Agriculture (USDA) Economic Research Service (ERS), in 2008, feed costs for livestock, poultry and dairy reached a record high of $45.2 billion – an increase of more than $7 billion over 2007 costs. A report released in September 2008 by the Congressional Research Service (CRS) stated that the dramatic increase in livestock production costs were attributed to feed. Foglesong said producers remain committed to producing safe and affordable food to consumers but today’s announcement will likely result in higher feed costs for livestock producers and all users of corn.
“While the current economic situation has taken a severe toll on the beef industry, it remains our number one responsibility to provide the world’s consumers with the safest, most nutritious and affordable beef and beef products,” said Foglesong, who is an Illinois beef producer. “U.S. renewable energy policies need to be evaluated carefully in order to determine the potential consequences the policies could have on all corn end-users from importers to livestock producers."
Source: National Cattlemen's Beef Association