One-Sided Article Blames Ethanol for Meat Price Hike
The ethanol industry was quick to respond to a Bloomberg Business Week article Monday that places the blame for the current hike in meat prices solely on using corn for ethanol.
The story quotes several meat industry representatives who state that current higher meat prices are “ethanol-induced” – the result of hog and cattle herds that were reduced in 2008 due because demand for more ethanol drove up the cost of feed.
Jumping to the defense of corn ethanol, Growth Energy CEO Tom Buis said the story “accepts as fact a disproven myth that ethanol somehow drives up food prices — the goal of a carefully coordinated propaganda campaign that is not based on truth.”
In fact, the Congressional Budget Office report released in April 2009 and a recent report from the UK found that it was mainly higher oil prices that drove prices for both food and feed higher in 2008. That was proven true last year when the amount of corn used for ethanol increased from 2008, but feed and food prices went down.
The completely one-sided article belatedly added a short paragraph with a response from the ethanol industry. Ethanol producers say their industry is unfairly blamed for the record feed costs of 2008. The surge reflected “wild speculation in the markets and the surge of index funds” rather than the jump in corn use for fuel, said Chris Thorne, a spokesman for Growth Energy, a Washington-based ethanol trade group. “Grain producers in this country will more than meet all expected demand for export, for food, for livestock feed and certainly for fuel.” That was added as an update in paragraph 22 some time after the original story was released on line.
3 Comments »
Pyotr Petrovich
It is cynical of the meat industry to blame their problems on ethanol when they now completely rely on the ethanol co-product DDGS to keep their feed costs lower. The use of this co-product has become so prevalent in almost all animal feed formulas that their costs would jump dramatically if all ethanol plants were closed. Corn exports have not increased as expected, mainly because export DDGS is replacing a considerable amount of the corn formerly imported for animal feeding overseas. The meat industry should be careful what they ask for.
Bob Winnson
These aren’t your family farmers and ranchers complaining about corn ethanol. These ARE multi-million dollar corporations, driven by their bottom line. The meat industry is a far different one than the livestock industry. They are really a part of the food industry, and the food industry is represented by the Grocery Manufacturers of America–the one slamming corn ethanol month after month. In reality, I believe that the meat industry knows that they are not losing out much at all due to corn ethanol…but it provides a nice red herring for them in the meantime. They can’t do much about oil prices, which is really what drives meat and food prices. So charge a lot for meat, and then blame it on the corn farmers. Typical move. And VERY typical for the mainstream media to take the corporations’ side in this one-sided article.
Steve_V
I wish we could get some good PR traction on this food and fuel issue. When growing up on a farm in Iowa some 30 years ago, I remember getting $54 dollars per hundred weight. I heard last week on the radio hogs were at $48. Something is wrong with this picture.
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