Ethanol creates schism within agriculture
The drive to fill the gas tanks of America's cars with corn-based ethanol is creating a division within the ranks of the country's agricultural producers.
The most recent acceleration of the trend has been the approval to nudge the percentage of ethanol at the gas pump from 10 to 15 percent.
Livestock and dairy producers rely heavily on corn for the rations they feed beef and dairy animals, hogs and poultry. The increased demand on the automotive side is causing prices for corn to increase beyond the level that animal feeders can pay.
Expected price increases for milk, red meat and eggs are sure to bring consumers into the controversy, whether they buy their meat and eggs at the supermarket or as fast food offerings. Nobody is promising that the gasoline they use to get to the purchase point will cost any less.
A long list of products on supermarket shelves are corn-based, or at least include enough corn ingredients to be influenced by higher corn prices. Begin with the breakfast cereals, and go both directions across the store.
Reducing America's dependence on foreign oil has been offered as a major goal by the promoters of ethanol. But some of those promoters also support oil drilling curtailment by this country in the Gulf of Mexico, in Alaska and in several offshore locations. The inconsistency of that presumption might cause many consumers to discount it.
Harder to discount is the claim that ethanol's use reduces greenhouse gases that contribute to climate change.
Automobile manufacturers apparently can design engines that will accommodate much higher percentages of ethanol. In Brazil, "gasoline" pumps consistently offer a fuel mix that contains 25 percent ethanol. The country's automobiles and light trucks seem to do quite well on it.
A major difference in Brazil's ethanol is that it almost entirely comes from sugar cane, not corn. A huge country, Brazil has devoted millions of acres to producing sugar cane for ethanol production. The U.S. doesn't have that reserve of tillable acreage, and so far has emphasized only corn as the primary source for ethanol.
What this country does have is a highly developed and integrated system of agricultural production and marketing. When major changes occur in one sector, such as corn, they are felt at many levels in several markets.
Not surprisingly, agriculture in California is so vast, so diversified and so specialized that hiccups like the one affecting the corn industry usually can be avoided. But this one is affecting California livestock, dairy and poultry producers who purchase large amounts of corn-based feed from the Midwest.
In California, corn barely rates major-crop status, with only about 125,000 acres in production. In contrast, the livestock, dairy and poultry segments are consistently among the top five or 10 segments of the state's vast agricultural panorama, which reached $36 billion last year, and promises to increase year by year. They buy corn grown elsewhere.
On this issue, California's vaunted fruit, nut and vegetable producers are mostly on the sideline. They will help maintain a stable production and income level for the state while the corn producers and corn consumers settle their differences.
Brazilians, in the meantime, are enjoying an increased measure of automobile independence while cleaning their air and elevating some in their farming community to super-rich status.
In this country, the driving public far outnumbers the farmers who buy corn for their animals. That is a strong clue to the outcome of the corn-ethanol dilemma, but it doesn't provide healing for the schism that ethanol production is causing within agriculture.
CONTACT Don Curlee at firstname.lastname@example.org