Higher stocks, acreage indicate plenty for ethanol, group says
By MATTHEW WEAVER
The Renewable Fuels Association considers several new USDA corn reports to be positive for ethanol production.
According to the association, the USDA's annual prospective plantings report and quarterly grain stocks report project 88.8 million acres of corn will be planted and total crop acreage to be virtually unchanged, with current corn stocks at 7.69 billion bushels, up 11 percent over last year at the same time.
"Farmers have once again produced enough corn for all uses, and still (have) some left over," said Matt Hartwig, association director of public affairs.
Acreage for all major crops hasn't increased, with incremental needs for ethanol being met through crop switching and not land-use change, the association reported in a press release.
Corn in storage is at the highest level since 1987, the association said, with the amount currently stored on farms, 4.6 billion bushels, larger than the amount of corn expected to be processed into ethanol in 2009-2010, 4.2 billion bushels.
Hartwig said concerns about corn supplies have been manufactured by opponents to ethanol production.
"Those in the know have always recognized that corn supplies have remained ample," he said.
"There's plenty of corn, there's going to be more corn," said Kennewick, Wash.-based consultant Michael Massey, noting sweet corn farmers near Quincy and Moses Lake, Wash., are likely to switch to field corn.
The ethanol industry is considering an Environmental Protection Agency decision to increase to a 15 percent blend of ethanol with gasoline, which would increase demand for ethanol, Massey said.
Hartwig said the industry's biggest focus is extending tax incentives for ethanol. The association is supporting HR4940, which would extend them all through 2015, he said.
U.S. corn farmers can feed the cattle, food and fuel industries, Massey said.
"We have three legs to stand on," he said. "That's going to help agriculture in general in the rural communities we have."
U.S. corn competes with Brazil sugar cane
Kennewick, Wash., agriculture consultant Michael Massey said some U.S. environmentalists believe that producing ethanol from Brazilian sugar cane is more efficient than making it from corn.
Massey disagrees with the analysis, saying it's based on rain-fed Iowa corn yields, typically 150 to 160 bushels per acre.
Farmers on the irrigated Columbia Basin Project in Eastern Washington have netted corn yields beyond 250 to 260 bushels per acre, Massey said.
"We're using a renewable irrigation resource from the Columbia River," Massey said. "Just like they do anywhere else there's a large river and arid conditions, where you can grow phenomenal yields."
It refutes the argument that U.S. corn ethanol will never approach Brazilian sugar cane ethanol efficiency, Massey said.
Massey said the next step is to complete the irrigation project. Completion would lead to a "truly huge" agriculture industry to export potato products and increase corn production, he said, spreading to enhance efforts throughout the region.
"That means putting another 600,000 acres in irrigation and there's no reason why we shouldn't do it," he said.