CCA News Release: Negative Effects of Ethanol Industry on Livestock Sector.

[AgrivilleAdmin]

Canadian Research Shows Negative Effects of Ethanol Industry on Livestock Sector



Calgary, AB – A study released today by the George Morris Centre indicates that Canadian ethanol production mandates are responsible for increasing costs to the Canadian livestock sector by $130 million per year.



The study, Impact of Canadian Ethanol Policy on Canada's Livestock and Meat Industry - 2012, quantifies the impact of biofuels policy through addressing a shortfall in existing research. To date papers on the impact of biofuel policy initiatives have examined U.S. policy alone and either completely ignored Canadian policy or assumed limited effect. Other papers cite the multiple factors involved in grain pricing but fail to consider the effects a subsidized competitor can have on local prices. The George Morris Centre report shows that Canadian ethanol policies have a ‘direct and important negative influence on the Canadian livestock industry.’



The Canadian Cattlemen's Association (CCA) has long advocated for a market-based biofuels industry. “Government policy that favours biofuels production as a purchaser of feed grain favours that industry at the expense of the livestock and meat sector," said CCA President Travis Toews. "We aren't against high grain prices, but we want to compete on a level playing field. The cattle industry fully appreciates how important a vibrant Canadian grain industry is to our sustainability."


“This research shows the negative effects that government imposed ethanol production mandates have had on the profitability and production of Canada's livestock and meat industries. Governments need to be aware of these effects,” Toews continued. “CCA policy supports the removal of subsidies, tariffs and the mandate. This would let the market decide the best usage of feed grain in Canada.”



Canada's beef industry is made up of over 83,000 farmers and ranchers. Sales of cattle and calves in Canada total over $6 billion and beef production contributes more than $24 billion to the Canadian economy.



The George Morris Centre is a Guelph, ON-based independent think tank. Their report can be found at: www.georgemorris.org.



The research was funded by the Canadian Cattlemen's Association, Canadian Pork Council and Canadian Meat Council.

[AgrivilleAdmin]

Canadian Research Shows Negative Effects of Ethanol Industry on Livestock Sector



January 31, 2012



Calgary, AB – A study released today by the George Morris Centre indicates that Canadian ethanol production mandates are responsible for increasing costs to the Canadian livestock sector by $130 million per year.



The study, Impact of Canadian Ethanol Policy on Canada's Livestock and Meat Industry - 2012, quantifies the impact of biofuels policy through addressing a shortfall in existing research. To date papers on the impact of biofuel policy initiatives have examined U.S. policy alone and either completely ignored Canadian policy or assumed limited effect. Other papers cite the multiple factors involved in grain pricing but fail to consider the effects a subsidized competitor can have on local prices. The George Morris Centre report shows that Canadian ethanol policies have a ‘direct and important negative influence on the Canadian livestock industry.’



The Canadian Cattlemen's Association (CCA) has long advocated for a market-based biofuels industry. “Government policy that favours biofuels production as a purchaser of feed grain favours that industry at the expense of the livestock and meat sector," said CCA President Travis Toews. "We aren't against high grain prices, but we want to compete on a level playing field. The cattle industry fully appreciates how important a vibrant Canadian grain industry is to our sustainability."


“This research shows the negative effects that government imposed ethanol production mandates have had on the profitability and production of Canada's livestock and meat industries. Governments need to be aware of these effects,” Toews continued. “CCA policy supports the removal of subsidies, tariffs and the mandate. This would let the market decide the best usage of feed grain in Canada.”



Canada's beef industry is made up of over 83,000 farmers and ranchers. Sales of cattle and calves in Canada total over $6 billion and beef production contributes more than $24 billion to the Canadian economy.



The George Morris Centre is a Guelph, ON-based independent think tank. Their report can be found at: www.georgemorris.org.



The research was funded by the Canadian Cattlemen's Association, Canadian Pork Council and Canadian Meat Council.

[AgrivilleAdmin]

Canadian Ethanol Policy Impacting Canada’s Livestock and Meat Industries


Guelph, ON (January 31, 2012) Canadian ethanol policy has directly impacted Canadian grain markets and users of grain, such as the Canadian livestock and meat industry. According to a study released today by the George Morris Centre, while there are many factors that influence grain and livestock prices, Canadian ethanol policies also have a direct and important negative influence on the Canadian livestock industry.



Canadian federal and provincial governments have developed policies for biofuels as part of a green fuels strategy to reduce petroleum fuel consumption and associated emissions. The Canadian ethanol industry has been created and supported by federal and provincial subsidies, grants and mandated usage of the product in gasoline. As a consequence, it creates a subsidized competitor for Canadian feed grains that form the basis of Canada’s export-based livestock and meat industry.



The study found the following:

§ Canadian ethanol production increases the price of feed grains in eastern and western Canada by about $15-20/tonne and $5-10/tonne respectively.

§ Canadian ethanol production resulted in reduction in livestock feeding margins and or increased losses for Canadian producers amounting to about $130 million per year.

§ Expanded use of ethanol to a 10% mandate will result in a serious reduction in feed availability in eastern Canada. This will result in a dramatic reduction of cattle and hog feeding in eastern Canada.



The bottom line is that federal and provincial ethanol policy has resulted in reduced incentives for livestock production in Canada. Expansion of the ethanol industry in Canada will amplify the negative consequences. As biofuel policy evolves it is important that governments and industry understand these implications on livestock and meat development. Government has demonstrated that in a short time, it can create a large ethanol industry. The same cannot be said for the livestock and meat industry. Governments must realize that the red meat industry developed over a long period of time; if it were to drastically decline, it would take a very long time to return.



The complete GMC report, “Impact of Canadian Ethanol Policy on Canada’s Livestock and Meat Industry 2012” is available on the homepage of the George Morris Centre website at: www.georgemorris.org



The George Morris Centre is a national, independent, economic research institute that focusses on the agriculture and food industry. The Centre’s areas of research include: trade, regulation, cost of production, food safety, market analysis, agricultural research, environment, competitiveness and corporate strategy.

[rkaiser]

And what about the potential positive effects.

1). The bi products from bio fuel are good quality feeds that can supply the energy needs of feeder cattle. I will leave out the details and hope that someone other than big mouth Kaiser can chip in something here.

2). The potential use of inedible offal and SRM material in the production of bio fuel.

A very good ignition point as well as a decent cloud point allow the tallow from rendered offal to either create a fuel product on it's own or mix well with grain and oilseed feed stocks to create bio fuel.

This opportunity could mean the difference between more profit and break even for any new packing plants and even more profitability for existing plants that I doubt like hell will trickle down to Canadian cattle producers.

3). An opportunity for cattle producers to make some changes to the way they feed and raise cattle that is not overly beneficial to the health of the cattle or the consumers anyway. Less grain and more forage create a healthier animal. The idea of eliminating hormonal implants and ractopamine, which require even more grain to finish cattle could be considered, opening doors for Canadian beef in export markets around the world. Markets that would allow a premium and not the discounted price now received in America for barley fat hormone and ractopamine laced Canadian Beef.

[Happytrails]

Bottom line is that using grain to
produce ethanol only leaves 1/3 of the
feed value in by-products as the
original grain. So a 60 bu/ac crop
feeds like a 20 bu/ac crop. Anyone who
thinks that won't hurt is dreaming.

The other point to remember is that
allocating crops for fuel use is like
pouring them into a bottomless pit. The
bio fuel from all N American agriculture
production would only supply about 4
months of our fuel appetite.

HT in sunny Arizona

[kato]

We live twelve miles from a big ethanol plant. It stinks. Literally. The aroma of fermenting wheat and corn comes blowing by on a regular basis. BTW, corn smells worse than wheat, to me.

As for getting byproducts to feed... it ain't happening. They only sell by the semi load or rail car load, and the local feedmills don't sell it either. Where it goes, I don't know. All I know is it's not staying around here.

So other than a few local jobs and some municipal tax money, and the occasional outlet for substandard grain, we don't see a lot of benefit ourselves from the plant.

Now, when they used to make whiskey there.... wink wink..

[rkaiser]

Good points you two, and I am not here to argue your percentages HT. Bottom line on DDG's is that it makes a decent cattle feed and can even finish the right type of cattle with less acidosis that other higher energy rations.

My argument for biofuels is partly due to our own potential JV with a biofuel partner to use rendered inedible offal for biofuel feedstock. Helps out the bottom line on a per animal basis at our packing plant and also gives us destination for the SRM with out a bill for disposal.

Hope NB's doesn't read this and steal out idea...LOL

The other thing I think is interesting about biofuel is that we have found a way to use some of the obvious excess grain that we are now producing on the planet due to GMO and fertilizer technology. Personally can't think of a better place to use that shit while we continue to find natural healthy food choices for human beings who deserve a choice.