Friday, May 12, 2017

Agriculture: The Crop That Ate America

Even Al Gore has come to understand that making fuel-ethanol from food is stupid. A major change from:
"I was also proud to stand up for the ethanol tax exemption when it was under attack in the Congress -- at one point, supplying a tie-breaking vote in the Senate to save it. The more we can make this home-grown fuel a successful, widely-used product, the better-off our farmers and our environment will be." 
-Vice-President Al Gore
Third Annual Farm Journal Conference, December 1, 1998
However by the time he came around it was too late.
November 22, 2010
U.S. corn ethanol "was not a good policy"-Gore' (ADM; PEIX)

From Bloomberg:
Farmers who had long rotated plantings among a diverse group of grains are increasingly turning to a single one. Corn has always been a mainstay of U.S. agriculture, but its increasing profitability has driven up corn's share of total production, while grains such as wheat, oats and sorghum have steadily fallen, according to a Bloomberg analysis of a half-century of crop data. This locks farmers, as well as machinery-makers including Deere & Co., to the rises and falls of one crop, as both domestic and export markets grow more and more tied to the dominant U.S. grain. That exposes farmers to greater volatility and greater trade risk if a major buyer, such as Mexico, were to decide to stop buying U.S. corn.

Corn will make up 68 percent of this year’s projected harvest of major U.S. grains and oilseeds this year, according to data the U.S. Department of Agriculture released Wednesday. That’s up from 47 percent in 1968. New markets and technology have made corn more profitable compared to other crops, which is why longtime farmers once devoted to competitive grains have switched to the nation’s number-one source for biofuels and cattle feed.
Kevin Skunes is a fourth-generation farmer outside Arthur, North Dakota. On his 6,000 acres, he currently raises about 55 percent corn, 45 percent soybeans. This constitutes a big change since Skunes was a child in the 1960s. Back then, the farm was about 2,000 acres of wheat, barley, sunflowers and soybeans, with no corn.

Sunflowers disappeared in the 1980s. Skunes raised his last barley crop about 15 years ago, his last wheat about a dozen years ago. He started experimenting with corn in 2001, becoming such a convert that he’s now a vice president at the National Corn Growers Association. He’s also raised sugar beets, common to the Northern Plains and almost nowhere else in the U.S., and dry edible beans.
But corn’s spread is unstoppable, he said—the economic case remains too strong, even with prices now less than half what they were five years ago.

“It was mostly the price of corn, along with the yields. The yields on wheat were not keeping up," Skunes said. “Corn just came up as the one that made money. It’s a little more work to grow, and you need some more equipment, but if you’re in a business and you see the money is there, that’s what you do.”...MUCH MORE