May 31, 2008

Drilling deeper into oil prices

The recent attack on corn ethanol is based on a faulty assumption that, of all the factors affecting food prices, the only one that can be changed by the government is the impact on corn demand and prices by ethanol producers, according the National Corn Growers Association Corn Commentary blog.

Here's what NCGA has to say:

We’ve long been of the opinion, shared by many, that higher energy prices have much more of an impact on retail food prices than grains such as corn. And a Wall Street Journal op-ed today argues that there is much Congress can do in this regard, such as allow more domestic drilling. In fact, its headline is “Blame Congress for High Oil Prices.”

But the real news today actually comes from the Commodity Futures Trading Commission, which has announced “multiple energy market initiatives.”

Among those initiatives? A nationwide crude oil investigation into practices surrounding the purchase, transportation, storage and trading of crude oil and related derivative contracts. In other words, price fixing.

Randy Klien of the Nebraska Corn Board pointed out that Associated Press has already picked up on this.

Popping the popcorn myth

We'd thought the popcorn myth - that ethanol is making popcorn prices go up at movie theaters -- had been popped a year ago. In fact, the Iowa Renewable Fuels Association did a great campaign to make the point. And yet we've seen a few reports about that again this year.

To help explain it, here's a quote from IRFA executive director Monte Shaw from an August 2007 news release:

The ‘blame ethanol’ game has gotten completely out of control. From a consumer standpoint, for $5 you can buy 1 tub of popcorn at a movie theater or 38.5 pounds of popcorn from a farmer, which, when popped fills nearly 12-33 gallon trash bags. From a farm standpoint, in 2006 the farmer received about 1.4 cents for the corn in that $5 tub at the movie theater. In 2007, that same farmer will receive about 2 cents to fill that tub. How can an increase of 0.6 cents to the farmer justify a price hike to movie goers or crazy headlines in the news media?

A recent article in Advertising Age started quite off track - saying that ethanol was driving up corn demand and taking away acres from popcorn production. Pretty crappy. But after the first few paragraphs the truth came out -- that popcorn prices were going up to help theaters cover the high cost of movies. Everyone knows that concessions are how theaters make their money, right? (Ticket prices go to the folks who make and star in the movie.)

And then, my favorite line:

... the price of the paper pulp to produce popcorn tubs has jumped 40% in the past 36 months, making the tub more expensive than the corn inside it.

So...we're paying $7 for a tub of popcorn...which contains 2-3 cents worth of corn. And the tub costs more. How does ethanol even enter into this at all?

UPDATE: The Nebraska Corn Board has sent out a press release on this subject. Check it out here.

May 30, 2008

A good blog on GoodFuels

The Renewable Fuels Association has launched a new blog called -- GoodFuels.

Check out GoofFuels by clicking here. And be sure to add it to your iGoogle, myYahoo or news reader like NewsGator's Newswire. You can also subscribe to news sources like Brownfield with Google, Yahoo or Newswire.

You're familiar with National Corn Growers Corn Commentary blog, right? Click here to take a peak. And don't forget about Domestic Fuel for fuel-related topics. The Clean Fuels Development Coalition also has a blog, called Clean Fuels Blog.

Food vs. fuel: A false and dangerous premise

Steve Grasz penned a commentary that appeared in one of the state's newspapers recently. The National Corn Growers also received permission to publish it -- click here to view. He is a partner in the law firm of Husch Blackwell Sanders in Omaha, Nebraska. He served as chief deputy Nebraska attorney general from 1991 to 2002 and has a wide-ranging background in agriculture.

Grasz does a great job outlining several ethanol myths...

But here's his conclusion:

America needs ethanol now, more than ever. The U.S. imports 62 percent of its petroleum supply and this is projected to increase to 77 percent by 2025. Oil production is declining in many areas of the world. The last time a new oil refinery was built in the U.S. was over 30 years ago. Taxpayers spend billions of dollars each year on military expenditures to protect our foreign oil supply while Congress refuses to expand domestic drilling for environmental reasons. In contrast, ethanol is made from renewable resources we grow right here in the U.S. Its use reduces our dependence on imported oil. The U.S. ethanol industry will have the capacity to produce 10 billion gallons in 2008.

The idea that people must choose between food and ethanol is a false and dangerous premise. The critics need to be called to account. The next time you hear or read that ethanol production is starving children overseas or causing food prices to soar, consider the all-time record amounts of corn being exported from the United States or the fact that doubling the price of corn raises the cost of a box of corn flakes by less than 4 cents – and think again.

May 28, 2008

Researchers don't see much concern over distillers grains


Researchers at the University of Nebraska-Lincoln have found no reason to believe the use of distillers grains as livestock feed poses a food safety concern.

This report comes after some headlines a few months ago suggested that feeding the ethanol co-product distillers grains would increase E. coli in cattle -- which could increase the chance of meat contamination during processing.

The researchers presented their findings at the Distillers Grains Technology Council meeting this week in Kansas City. After reviewing research by Kansas State and previous research at UNL, they concluded that distiller grains have had no “demonstrably consistent” effect on E. coli shedding from livestock. They also said that data are inconsistent -- and that more research is needed.

“At this point, there is no scientific evidence that feeding distillers grains, at least at levels being used commercially, is the cause of a food safety crisis,” they conclude. “Additionally, there is no scientific evidence to suggest that the feeding of DGs is the cause of the 2007 recalls.”

The National Corn Growers has posted a copy of the report here.

May 27, 2008

Corn nearly all planted

Improved weather has allowed Nebraska farmers to catch up on corn planting, according to USDA’s National Agricultural Statistics Service, Nebraska Field Office. In fact, 96 percent of Nebraska’s corn is in the ground, which is the same as last year and the average for this time of year. It's also up 13 percent from last week.

Emerged corn is at 59 percent, ahead of last weeks 25 percent, but behind last years 75 and the average of 76 percent. For details, be sure to check out this week's Crop Progress Report.

Farmers across the country made big strides over the past week in getting their corn in the ground, but are still behind the normal pace. USDA said 88 percent of the corn crop is planted, compared ti the 94 percent average over the previous five-year average.

May 26, 2008

Podcast: USDA data sets record straight

Corn producer Lynn Chrisp talks about USDA's recent news conference where it discussed ethanol's impact on food prices.

Call to action on smear campaign

The National Corn Growers Association is asking members and other interested individuals who would like to encourage the Grocery Manufacturers Association to end it's ethanol smear campaign to write letters to some GMA member companies.

To participate or learn more,
click here!

Senator Chuck Grassley of Iowa is also encouraging citizens to at act. He's posted a news release about it here.

Here's what he had to say:

You can imagine my sadness and disappointment when I learned that the National Retail Federation and National Restaurant Association took part in this call and joined in the GMA’s efforts to undermine our policies to promote renewable energy. Maybe the national associations will rethink their support if they hear from state-level members. The way things go for agriculture and renewable energy in Iowa has a lot to do with how they go for other parts of Iowa's economy, including retail and restaurants. Even before possible job losses and lower profits in farming, without ethanol, people across the country would pay more at the gas pump and have less money left in their pocketbooks to spend.

May 24, 2008

The 'Astro-Turf' grocery gang campaign

Columnist and former farm boy Alan Guebert pointed his pen this week at the "grocery gang" -- the groups behind the recent anti-ethanol campaign. Read it here.

Guebert said: "The gang — a wealthy lobby of over 300 food and beverage makers and marketers like Kraft Foods, Miller Brewing, Dean Foods and ConAgra — made, then marketed, today’s highly believable, highly fake food vs. fuel debate.
" As fake as Astro-Turf.

The gang hired Glover Park, a Beltway PR firm, which came up with a plan to
sell “a federal agency-level or legislative solution to the economically, environmentally and socially untenable ethanol policies now in place…”

Within weeks, anti-ethanol seeds, bought by GMA and planted by Glover Park, take root. Everyone from the New York Times to World Bank President Robert Zoellick is linking American ethanol to starving Sudanese children or worse.

But wait. Aren’t other, more powerful market forces—global grain demand outpacing production seven of the last nine years, crude oil prices 500 percent taller than 10 years ago, inclement weather—propelling grain prices more than U.S. ethanol?

Sure, but don’t tell the grocery gang.

Falling profit margins, not honesty, is behind their nasty, divisive campaign.

Even worse, these truth-challenged food giants are using the poorest of the poor, “…hunger, food aid, poverty, development, senior, children,” to reclaim their fat margins.

In a town long-known for its shameless demagogues, these folks take the cake.

May 23, 2008

Standing up for ethanol

The Nebraska Corn Board and Nebraska Corn Growers Association said today they appreciate that a bipartisan group of Senators have spoken out against the misinformation campaign that targets corn producers and the corn ethanol industry as being behind a rise in food prices. (Click here for a previous post.)

Nebraska Senator Ben Nelson (D) said at a news conference: I'm not sure when it happened or why it happened but it's incredible to me that someone decided to add ethanol to the members of the axis of evil. They ignore the fact that the cost of oil has far more triggered the cost of products and living in the U.S. than the grinding of corn into ethanol.

The group of Senators, organized by Iowa Senator Chuck Grassley (R), addressed many of the issues raised by ethanol critics when it comes to the biofuel’s contribution to food costs. “It’s a smear campaign based on ignorance,” Grassley said. “My question to the Grocery Manufacturers Association is, do you want America to place its trust in OPEC or in U.S. farmers? The short-sighted, self-serving campaign of this trade association and its allies is at America's expense.”

Corn Board and Corn Grower leaders said that now is not the time to shy away from renewable fuels like corn ethanol, especially since ethanol is saving consumers at least 15 percent at the pump, which translates to about $70 billion per year nationwide.

For the full story, click here.

May 21, 2008

It's incredible. It's edible.

Did you Nebraska is the eighth-largest egg producer in the country?

Or that some 3 billion -- yes billion -- eggs are produced here each year?

Those eggs don't typically show up in cartons in the grocery store. Instead, they
are processed by Nebraska companies – known as “egg breakers” – and turned into high-value pasteurized refrigerated liquid eggs and frozen, dried and specialty products.

"These further processed products are then sold all over the world, in many cases to exacting specifications,” said Bob Dickey, a Nebraska Corn Board director and corn grower from Laurel. “These types of egg products find their way into the foodservice sector, as well as into items like frozen breakfast foods and bakery goods found in the grocery store.”

The Corn Board's Kelly Brunkhorst said the egg industry contributes about $100 million to the Nebraska economy each year -- with part of that contribution coming through the consumption of more than 10 million bushels of corn and the growing usage of distillers grains.

For more, click here.

May 20, 2008

Podcast: Who's behind the ethanol smear campaign?

Don Hutchens, executive director of the Nebraska Corn Board, talks about the ethanol smear campaign.

May 16, 2008

Ouch! Biting the hand that feeds you


The news broke this week when a Capitol Hill insider publication Roll Call published a story outlining the efforts of the Grocery Manufacturers Association (GMA) and some of its assorted cohorts to smear ethanol. And Senator Chuck Grassley (R-Iowa) blasted GMA on the floor of the Senate -- and even posted GMA's proposal on his website.

GMA said it wanted to build "a global center-left coalition," which includes environmental, hunger, food aid, poverty, development, senior, children, business, nutrition, farm consumer and labor groups; taking advantage of the "extraordinary earned media opportunities" caused by rising food prices; mobilizing local food banks and "other local opinion leaders in key states and districts"; and hiring "trusted third-party experts" to document the effect of fuel mandates on, among other things, global hunger and poverty, job losses in the food industry and inflation.

A pretty disgusting list all based not on GMA's concern for these groups, but for profits for its member companies (even though many of its companies are quite profitable).

The Nebraska Corn Growers Association posted the article here.

“It is becoming very clear that there is a lot of money being made out there by companies that are doing very well with higher energy costs, and they want to keep it that way by shifting the blame to agriculture,” said Don Hutchens, executive director of the Nebraska Corn Board. Hutchens made his statement in a news release, which is posted here.

Another area of concern is that one of GMA’s spokesman on the subject is a former environmental activist who worked for a group that is generally anti-agriculture and anti-technology. “Why GMA would hire someone who is anti-agriculture is something I can’t understand,” Hutchens said.

Senator Grassley (R-IA) called GMA’s tactics an “Ethanol Smear Campaign”. He went on to say, “None of these criticisms are based on sound science, economics or even common sense.” Grassley said he felt it is important for policy makers and the American people to know who’s behind the effort, and that they have outlined their strategy of using environmental, hunger and food aid groups to demonstrate their contrived “crisis”.

May 15, 2008

Have you thanked your cattle producer?

May is beef month. And it makes me hungry for a tasty Nebraska steak just typing that.

The Nebraska Corn Board put out a news release today discussing some things it does to support beef production right here in Nebraska. This includes research with the University of Nebraska into feeding cattle corn co-products like distillers grains. In fact, it wasn't that long ago that the second edition of the handbook titled “Utilization of Corn Co-Products in the Beef Industry” came out.

Another manual on methods of storing distillers grains, so cattle producers can stock up on the feed ingredient, will be released soon.

“There is probably no other state that has as much knowledge and actual experience in feeding distillers grains as Nebraska,” said Dennis Gengenbach, chairman of the Corn Board’s Research Committee. “In fact, the Corn Board has allocated nearly $200,000 this year alone in distillers grains research.”

Executive director Don Hutchens added that the Corn Board now spends three times more money on meat exports than it does bulk corn exports.

According to Stan Boehr, chairman of the Corn Board’s Government Affairs Committee, there is also tremendous opportunities for the two commodity organizations to work together on federal policy issues:

For two years now we have traveled to Washington, D.C., together with representatives of the Nebraska Cattlemen to lobby for issues we mutually agree on. Getting more beef back into the world market has been our number one focus, along with animal welfare and environmental issues. By working together, we can pack a much more powerful punch, and our representatives in Washington appreciate the fact that we do this. It’s unique to Nebraska.

Without corn ethanol, we’d really be paying at the pump


NeCGA president Randy Uhrmacher has written a commentary that discusses the high profits of the oil industry, how high oil prices are impacting everyone and nearly everything. And that ethanol does not play a significant role in food prices.

For the full commentary, which has appeared in several newspapers across the state, click here; but here's his conclusion:

The simple truth is, if it weren’t for biofuels like corn ethanol, we’d be paying considerably more at the pump, and transportation and processing costs for food companies would be even higher than they are today. Iowa State researchers estimated that without ethanol, gasoline would be 29-40 cents per gallon more than it is today. Merrill Lynch reported ethanol lowers gas prices at least 15 percent.

The bottom line is, ethanol is saving consumers billions of dollars. At the same time, its providing thousands of jobs in rural communities, providing numerous environmental benefits and is helping pave the way for biofuels of the future. The best part? It’s available today!

May 13, 2008

Podcast: The RFS is sound policy

Scott Merritt, executive director of the Nebraska Corn Growers Association, discusses the importance of the RFS.

May 12, 2008

Planting passes half way point

Nebraska corn producers had 55 percent of their corn crop planted as of May 11, according to the U.S. Department of Agriculture’s Crop Progress report released today. That is up from 31 percent a week ago but behind last year’s 64 percent and the five-year average of 71 percent.

Rainy weather is behind this year’s slower pace.

Nationally, 51 percent of the crop was in the ground, up from 27 percent last week. This compares to 71 percent last year and 77 percent for the five-year average.

Be sure to check out this week's Crop Progress Update, which is updated about every two weeks and includes photos sent in from across the state by FFA students.

May 9, 2008

Oil-rich states starve the World Food Program

High oil prices are increasing the price of food in this country - but imagine what high oil prices do to poor and developing countries that rely on oil imports for energy. Many of these same poor countries also rely on food aid in one degree or another -- aid that some global groups like the World Food Program say is running short.

The United States stepped up with increased donations, of course, and in fact the U.S. is by far the largest aid provider to WFP.

But wait...what about those oil-rich and getting richer countries -- who can't figure out how to spend all the cash their getting now -- don't they provide food aid or money to WFP and similar programs
? Click here for the answer. I doubt it will surprise you.

Working 24-7 to defend ethanol

National Corn Growers Association CEO Rick Tolman was in Lincoln Wednesday, a day after testifying in Washington, D.C., on how corn producers are meeting food and fuel needs.

While in Lincoln he did interviews with several print, radio and TV reporters to help set the record straight on the issue. He was asked question after question time and again, but he's a pro and handled it like a champ.

To view a report by Peter Shinn of Brownfield, click here. Tolman told Brownfield that he's been working practically non-stop to counteract a sophisticated, multi-million dollar public relations campaign by the oil and food processing industries against ethanol.

Here's a quote from an article by Robert Pore of the Grand Island Independent: "To say that we don't need an ethanol industry and that it's driving up the cost of food is just incredible, and they are getting away with it. Certainly, higher corn prices have some impact on food prices, but nowhere near what higher fuel prices do on a retail level. It's almost 3-to-1, but we are getting the blame for that."

For a report by Alicia Myers at KOLN/KGIN TV, click here. And here's a mention on KETV.

May 6, 2008

Podcast: Taking ethanol story to the media

Elgin Bergt discusses some of the ways corn producers are telling the positive story of ethanol to the national media.

May 5, 2008

Ethanol's bum rap

Business Week ran a nice article this week called "Is Ethanol Getting a Bum Rap?"

The illustration (shown here), was clever, and reporter John Carey made several good points -- including that ethanol “isn’t quite the villain critics make it out to be,” especially with regard to food prices.

Carey quotes David Morris, vice president of the Institute for Local Self-Reliance, who says that biofuels are "a very, very small factor" in rising food costs. He also quoted Nathanael Greene of the Natural Resources Defense Council, and Richard Hamilton, CEO of Ceres Inc.

Lots of good stuff in the article.

May 2, 2008

Little Bo Peep or the Axe Murder?

The Corn Commentary had a great post yesterday following a press conference at the National Press Club. Here's the lead, but it's worth clicking through to the full report and audio.

Is ethanol Little Bo Peep or the Ax Murderer?

That’s the question National Corn Growers CEO Rick Tolman presented to the media during a press conference in Washington DC on Wednesday, pointing to the front page article on ethanol and corn prices in the Washington Post as being the latest example of making ethanol out to be the ax murderer.

“There’s a lot of misinformation, slanted information that is just inaccurate,” Tolman said. “While we do have some role in higher food prices in the corn industry, we are certainly closer to Little Bo Peep than the ax murderer.”