Tyson: Feed costs likely to hike meat prices(ethanol is to blame)

[4dsc]

Looks like an early warning shot across the bow..

Tyson Foods Inc., the world's largest meat processor, warned Monday that rising corn prices could mean U.S. consumers will have to pay more for chicken, beef and pork next year as it ended its fiscal year with a third straight quarterly loss.

Bond said the price of corn, which is used as animal feed, is going up because of demand from ethanol plants that are springing up to provide alternative fuel sources to oil.

Corn prices recently reached 10-year highs.

Bond said meat producers, processors and retailers will have to pass the higher grain price on to consumers because they cannot absorb it in their profit margins.

Bond did not provide more details but suggested the higher consumer prices could come when meat demand typically increases during the spring and summer.

"Quite frankly the American consumer is making a choice here. This is either corn for feed or corn for fuel, that's what's causing this," Bond said.

http://siouxcityjournal.com/articles/2006/11/13/news/latest_news/ee90931aedb997f48625722500784d2c.txt

[WindRavenX]

1. Just another reason to cut meat out of your diet

And go veg.

[aquart]

2. Wait till you see the prices on the veggies.

[WindRavenX]

4. There's plenty to eat

I get tofu damn cheap at Trader Joe's. Salad greens are still cheap by me.

[Kali]

8. Nah - at least for beef there is the perfedct alternative to feeding them corn

that is letting them eat grass like nature intended. Better beef, better for you. WAY better for them.

[WindRavenX]

10. absolutely

I have no real "moral" issues with the actual human consumption of meat-- it's just that 1) Americans eat waaaaaaaaaaaaay too much of it 2) As "raising" and slaughtering go, the method in which most meat is delivered is out of cruelty.

I have had "wild" beef before, and it was delicious. I can't digest most red meat anymore, fwiw.

[suziedemocrat]

13. I can't digest meat either!

I've been a vegetarian since 1986. Still drink milk and eat cheese though. People treat me like I'm the weirdest person because I say I have problems digesting meat. I'm glad I'm not alone.

[Kali]

19. I suspect you can digest it just fine, if you were to give it more than one chance

any time you add something new to your diet you can "upset the system", as it were - if you didn't eat dairy for a long time and then chugged a bunch of milk at once, I bet you would have some "digestive" problems. Same with anything. I even have to adjust when I switch meat sources, for instance if we have only been eating our freezer beef and I buy something else on sale at the store, I often have a little adjustment - reverse true as well, if we have been eating a lot of store meat (which I do try to avoid, but hey life happens) and then fill the freezer and switch back to the good stuff, it always takes me a couple meals to adjust.

Don't even think about what legumes do when you haven't been eating them in a while - it takes time for your system to adjust and some people are more sensitive (or they are more attuned to their systems) than others. And if you aren't wanting to eat something anyway it is easy to say oh that made me ill, I can't eat it anymore, while on the other hand if it something you want to have, symptoms might be attributed to any number of other causes, even "food poisoning". I doubt if you really can't digest meat, but have no doubts that it might make you "sick" if you ate it once or twice.

[suziedemocrat]

22. No - I really can't digest it.

I never had an easy time with meat, and in college many people thought I was a vegetarian. After college I joined the peace corps and got amoebic dysentery which was diagnosed when I left. I ate the local meat there (mostly field rats). They gave me iodine or something for the amoebas, and I think that did a number on my stomach. After getting clear of the amoebas, I started getting migraines and then horrendous vomiting that lasted for about 18-24 hours. I went to a doctor who didn't know what was wrong, but I noticed I was only getting these attacks when I ate meat. A pharmacist said that my stomach was not completely breaking down the protein and so these clumps of amino-acids were probably going through my blood, which my body thought was a virus, so it was reacting violently. I haven't tried to eat meat for years, but it took months before I realized meat was the problem with my migraines and vomiting, so it wasn't just once of trying meat. Since I have no desire to spend the next 24 hours in intense pain and vomiting violently, I don't think I'll try meat again for a while.

[Kali]

23. Jeebus! I was worried you really would be an exception as I was writing that..

I think there are also some genetic protein deficiency sorts of diseases that cause people to not be able to eat meat but it is pretty rare - could that be part of your problem as well? Iodine for amoebas? Yikes, pretty nasty stuff in any concentration. Where did you your Peace Corps service?

[Mythsaje]

3. Maybe they should pay their administrators a little less...

and stop transfering to the consumer what might be considered the ordinary cost of doing business.

Oh, wait. That's not the Corporate American Way!

[Twillig]

5. They could turn their shit-soaked chickens into a

source of methane if they had a lil' gumption.

or perhaps seperate the shit from the chicken and do that.

[phantom power]

6. Astonishing. There is no free lunch(meat).

[Vorta]

7. A saw a big fat bunny rabbit in the front yard today

And the backyard is crawling with lizards, palmetto bugs, and rat snakes.

A little soy and some rice and we're good to go.

[kestrel91316]

18. Hmmmm. Raise your own chickens and feed those palmetto

bugs to THEM.

[Dead_Parrot]

9. I smell a good source for bio-methane...

Whilst there may be conflict between ethanol and meat in the near future, I don't see how current ethanol production levels would cause that sort of price hike. However:

The US Agriculture Department has reported that growing conditions for the US spring wheat crop were the worst in 18 years.

Corn and barley prices are also likely to rise, which may push up the cost of beer and breakfast cereals.

The US has had the warmest year on record and Europe has experienced a heatwave that has damaged grain crops at a time when worldwide stocks are relatively low.

From http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=115&topic_id=61181

So two things about this statement:
- There's no mention of worsening growing conditions and climate change,
- The villain of the piece is a renewable energy used for transport.

Anyone else think that they may been 'helped' with their statement? By a certain corporation not renowned for it's environmental honesty? Who wouldn't want to see a lot of ethanol production?

Who could that be, I wonder...

[elocs]

11. Corn based ethanol is a loser.

It is a prima donna crop which requires lots of petroleum based fertilizer, pesticides, lots of water, and to top it off it depletes the topsoil. It takes more energy than it gives back. I am against a lot of ethanol production. Food is for eating, not for powering cars. Corn is not just used as animal feed because it is in lots of our food. I am not surprised that the use of food to make ethanol would increase the price of related products.

[Dead_Parrot]

12. possibly...

...I'm certainly no avid fan of ethanol, but it's going to be a big part to play what ever it's made out of. That isn't the point, though.

What strikes me is that the US's declining ability to produce corn - whatever it's eventual use - is going to affect the price a lot more than ethanol production at this stage. Here's the USDA's corn production figures:

Year yield (bbu)
2001 9.92
2002 9.50
2003 8.97
2004 10.09
2005 11.81
2006 11.11 (est)
2007 10.75 (est)

That's a 9% drop in 2 years, even with increased land being given over to corn: This isn't a commodity going down in price any time soon.

The US's evaporating carrying capacity has got fuck all to do with ethanol, but maybe something to do with that permanent drought that seems to hang over the continent, including a fair chunk of the corn belt.

[suziedemocrat]

14. I read that corn for ethanol does not need as much pesticide/fertilizer.

Because it does not have to be grocery-store perfect. Also, my cousin sells non-petroleum based fertilizers in Indiana. And if you rotate between soy and corn, it is good for the soil.

[Chemical Bill]

20. um...

>It takes more energy than it gives back.

Do you have a reference for this? The USDA says that it gives back more energy as ethanol than it takes to make it.
http://www.ers.usda.gov/publications/aer721/

Bill

[elocs]

24. Ethanol: A tragedy in 3 acts:

http://www.businessweek.com/autos/content/apr2006/bw20060427_493909.htm

"Epilogue: Get this Wasteful Show Off the Road

The other negative aspect of this inefficient fuel is that numerous studies have found that ethanol creates less energy than is required to make it. Other studies have found that ethanol creates "slightly" more energy than is used in its production. Yet not one of these studies takes into account that when E85 is used, the vehicle's fuel efficiency drops by at least 25% -- and possibly by as much as 40%. Using any of the accredited studies as a baseline in an energy-efficiency equation, ethanol when used as a fuel is a net energy waste.

Furthermore, no one has even considered the severe disruption in the nation's fuel distribution that mandating a move into ethanol would cause. Over the past month, gas stations from Dallas to Philadelphia and parts of Massachusetts have had their tanks run dry due to a lack of ethanol to blend. The newswires have been filled with stories bemoaning the shortage of trucks, drivers, railcars, and barges to ship the product. Ethanol can't be blended at refineries and pumped through the nation's gasoline pipelines.

The recent price spikes for gasoline have forcibly reminded the people of Chicago and Wisconsin of what happened when ethanol was forced on them during the summer of 2000. Moreover, the promise of energy independence that Brazil has explored through ethanol is widely misunderstood. Recently a Brazilian official, commenting on our third and most recent attempted conversion to ethanol, said that when Brazil tried using agricultural crops for ethanol, it achieved only a 1:1.20 energy conversion rate, too low to be worth the effort."

[Chemical Bill]

28. That's a nice editorial...

which should not be confused with a study. My reply is that every car that drives on ethanol is one less that we have to kill Iraqis to drive.

I understand that corn ethanol is being pushed by ADM to the detriment of ethanol made from more efficient crops. I also understand that biodiesel returns much more energy than ethanol, which is why I drive a diesel powered by biodiesel. But I don't think that bashing ethanol with a lie is productive thinking. Making ethanol doesn't consume more energy than it gives. You also neglect to point out that making ethanol consumes energy that doesn't always come from petroleum. IIRC, the petroleum to ethanol ratio is about 6:1. Do you want me to look that up for you, or is the concept enough for this discussion?

Bill

[elocs]

29. Let's stick with the specific subject: corn ethanol.

Just because you don't agree with something or somebody's differing opinion does not make it a lie.
Then again, life is easier if you disregard or call a lie everything with which you disagree.

http://healthandenergy.com/ethanol.htm

"An acre of U.S. corn yields about 7,110 pounds of corn for processing into 328 gallons of ethanol. But planting, growing and harvesting that much corn requires about 140 gallons of fossil fuels and costs $347 per acre, according to Pimentel’s analysis. Thus, even before corn is converted to ethanol, the feedstock costs $1.05 per gallon of ethanol. The energy economics get worse at the processing plants, where the grain is crushed and fermented. As many as three distillation steps are needed to separate the 8 percent ethanol from the 92 percent water. Additional treatment and energy are required to produce the 99.8 percent pure ethanol for mixing with gasoline. Adding up the energy costs of corn production and its conversion to ethanol, 131,000 BTUs are needed to make 1 gallon of ethanol. One gallon of ethanol has an energy value of only 77,000 BTU. "Put another way", Pimentel says, "about 70 percent more energy is required to produce ethanol than the energy that actually is in ethanol. Every time you make 1 gallon of ethanol, there is a net energy loss of 54,000 BTU". Ethanol from corn costs about $1.74 per gallon to produce, compared with about 95 cents to produce a gallon of gasoline. "That helps explain why fossil fuels-not ethanol-are used to produce ethanol", Pimentel says. "The growers and processors can’t afford to burn ethanol to make ethanol. U.S. drivers couldn’t afford it, either, if it weren’t for government subsidies to artificially lower the price".

Most economic analysis of corn-to-ethanol production overlook the costs of environmental damages, which Pimentel says should add another 23 cents per gallon. "Corn production in the U.S. erodes soil about 12 times faster than the soil can be reformed, and irrigating corn mines groundwater 25 percent faster than the natural recharge rate of ground water. The environmental system in which corn is being produced is being rapidly degraded. Corn should not be considered a renewable resource for ethanol energy production, especially when human food is being converted into ethanol".

The approximately $1 billion a year in current federal and state subsidies (mainly to large corporations) for ethanol production are not the only costs to consumers, the Cornell scientist observes. Subsidized corn results in higher prices for meat, milk and eggs because about 70 percent of corn grain is fed to livestock and poultry in the United States. Increasing ethanol production would further inflate corn prices, Pimentel says, noting: "In addition to paying tax dollars for ethanol subsidies, consumers would be paying significantly higher food prices in the marketplace". Nickels and dimes aside, some drivers still would rather see their cars fueled by farms in the Midwest than by oil wells in the Middle East, Pimentel acknowledges, so he calculated the amount of corn needed to power an automobile: The average U.S. automobile, traveling 10,000 miles a year on pure ethanol (not a gasoline-ethanol mix) would need about 852 gallons of the corn-based fuel. This would take 11 acres to grow, based on net ethanol production. This is the same amount of cropland required to feed seven Americans.

If all the automobiles in the United States were fueled with 100 percent ethanol, a total of about 97 percent of U.S. land area would be needed to grow the corn feedstock. Corn would cover nearly the total land area of the United States."

IIRC, the petroleum to CORN ethanol ratio is about 1:.33 Do you want me to look that up for you, or is the concept enough for this discussion? Because anything less than 1 is an energy sink. Corn ethanol is an energy sink. That is CORN ethanol.

I guess I missed the studies in your post. We all know that studies are definitive since no two studies ever disagree with each other. Generally you are going to find your rah-rah ethanol supporters to be those who will gain by its production (sorry, no study here either, just may opinion). But studies and opinions are like assholes--everybody has one. I'll believe mine, you can believe yours. Anything that will allow us to continue to drive our cars and trucks anywhere and everywhere we want must be good and unquestioned as being good.

[Chemical Bill]

30. I thought the subject was meat prices.

Pimental has been exposed as a liar. BTW, he has teamed with Tad Patzek, an oil industry paid researcher, on anti-biofuel studies.

http://biodieselnow.com/forums/permalink/3932/3904/ShowThread.aspx#3904

Based on quick analyses a few friends (scientists in various fields) have done of Pimentel's biodiesel (and ethanol) energy balance assessments, and comparing to previous assessments (such as the 1998 assessment done by the DOE/NREL which they found a positive energy balance of 3.2):

1. Pimentel used highly inflated numbers for energy inputs practically everywhere. A few examples:

2. The electricity used by the soy oil processing plant he claimed was ten times as much as the DOE used in their analysis - even though the DOE's electricity figures were already inflated to twice as much as what plants coming online at the time were using. So, Pimentel's electricity usage in processing is at least 20 times what's realistic for processing plants.

3. Pimentel included the energy to build the farm machinery as an energy requirement - but didn't properly account for the fact that the machinery lasts decades (he basically treated it almost as if you have to buy new tractors, combines, and everything else every year or two).

4. Pimentel included the food eaten by workers (on the farm and everywhere) as a fossil energy input - as if one unit of energy in the form of any food requires one unit of energy in the form of fossil fuels to produce. Not at all realistic.

5. He included way, way, way too much lime as being needed for treating soils, and with a very high energy input for producing the lime. For example (reference deleted for the moment - he's writing a more thorough analysis, which I'll link later), in North Carolina, where the soil is highly acidic (so you need more lime than normal), farmers growing soy typically put 2500 kg of lime on per hectare every 3-4 years (so 625-833 kg/hectare). In the mid-western US, where soils are less acidic, considerably less is used. Yet, Pimentel claimed that 4800 kg is needed PER YEAR - roughly an order of magnitude too much for most soy farmland in the US).

6. He used fertilizer application rates too high by 20-50%, and overstated the fossil energy input for fertilizer production by at least a factor of 2.

7. Used plant processing efficiencies from the mid-80s (for the ethanol analysis) - modern efficiencies are far, far greater. And so on. Basically at every step of the process, he greatly overstates energy inputs (ranging from 10% to hundreds of percentage points), and then also claims substantially lower yields (basically using the lowest yields he could find, even though it meant going back decades).

That's why Pimentel has no credibility in the scientific community. Unfortunately, the media doesn't care about that. Talk of his analysis has been going on all over the place - it seems that this is the start of a campaign against biofuels.

That was written by a UNH professor who is researching biodiesel, but as you can see he is talking about the ethanol study by Pimental as well.

>Just because you don't agree with something or somebody's differing opinion does not make it a lie.

No, I only consider something a lie if it is not true.

>Then again, life is easier if you disregard or call a lie everything with which you disagree.

You might want to research this more....

Bill

[hunter]

31. The very BEST numbers corn ethanol supporters trumpet are still bad.

Oh, but we can feed the waste streams of ethanol production to factory farm animals and that makes everything hunky-dory...

What kind of hell is this?

That's me, hunter, talking, not Pimental or any of the other people you might consider liars.

[suziedemocrat]

15. Meat SHOULD be expensive!

[Nihil]

16. So should petrol in the USA. So should air-travel everywhere.

So should a lot of things.

Any guesses on why they aren't?

The answer is "POLITICS".

[Oerdin]

17. there is massive BS in that article.

Namely, they've deliberately over looked an extremely easy solution. In the US tariffs continue to keep out foreign made ethanol as well as foreign grown sugar. The reason is because the corn lobby wants protectionism so that they get higher prices.

Simply eliminate those tariffs and watch as massive amounts of sugar cane (which simple has more sugar then corn and so produces a HELL OF A LOT more ethanol per lb then corn) are fermented instead of second rate and more expensive corn syrup. There would also be a big market for imported ethanol from places like Brazil which already have established ethanol plants. Feed corn need not be effected at all though in all likelihood prices would collapse over night without protectionism because something like 40% of the corn crop is now used to make sweeteners and there is no need if we have cheaper cain sugar on the market. Where would that 40% of the corn crop go? One thing is sure prices of corn would fall and fall big so the price of feed would fall big.

[elocs]

25. Is Europe's thirst for ethanol a threat to the rainforest?

http://the-greenhouse-effect.blogspot.com/

"Only a small fraction of Brazilian sugar cane plantations are presently in the provinces in the Amazon basin, but other rainforests are under real threat from expansion of sugarcane plantations. This is particularly true for the Atlantic rainforest, covering the area north of Sao Paulo, which already is depleted by 93%, and only 7% remains.

So it is without doubt that there exists a real threat to remaining rainforests in Brazil if Europe (and possibly also the US) starts to import vast amounts of ethanol from Brazil.

Another issue is the burning of sugarcane fields in Brazil before harvest. This creates enormous smoke clouds that can easily be seen on satellite images. A few of the most modern Brazilian plantations however use modern harvesting equipment which eliminates the need for open burning of the sugarcane fields.

This should be kept in mind when choosing future fuel alternatives for automobiles. The present situation makes it necessary to uphold the levy on imports of ethanol for vehicle use in order to promote domestic alternatives in Europe and the US and to make other alternatives (like hybrids, hydrogen fuel, electric) more competetive."

[JohnWxy]

21. Congress passed legislation repealing cotton export subsidies ($4 Bil/yr)

If Bush signs the legislation ending cotton export subsidies ($4 billion per year to make out cotton exports competitive) the farmers planting cotton would find it was no longer profitable to raise cotton (a non-food crop that seriously depletes the soil of nutrients). they would then look for another crop to raise, since Corn is going for good prices the likely choice would be to grow corn.

And how much acreage is planted to cotton now? - just about as much as the acreage planted to corn for ethanol. so if most of the cotton acreage went to corn for ethanol - guess what - you'd see nearly a DOUBLING of the acres planted to corn. what would THAT do for corn prices?

Or Bush could NOT sign the legislation ending export subsidies and we could eat cotton. Tasty and SO nutritious!


http://www.ustr.gov/Document_Library/Press_Releases/2006/February/Congress_Approves_Legislation_Repealing_Cotton_Subsidy_Program.html

Congress Approves Legislation Repealing Cotton Subsidy Program
Step 2 Repeal Addresses Important Trade Priorities 02/01/2006

WASHINGTON – Today, the U.S. House of Representatives approved legislation that will repeal a support program for cotton known as "Step 2." The next step is for the President to sign the measure into law.

"Repeal of this program addresses two important trade priorities. It implements findings in the WTO dispute brought by Brazil, and it fulfills commitments made at the recent Hong Kong Ministerial to eliminate export subsidies for cotton by 2006," Portman said. "These are important objectives, and I commend the Congress for working with the Administration to address these critical issues."
------------------------------------------------------------------------------------------------------------------------------

[elocs]

26. Ethanol could leave the world hungry:

http://money.cnn.com/magazines/fortune/fortune_archive/2006/08/21/8383659/index.htm

"(Fortune Magazine) -- The growing myth that corn is a cure-all for our energy woes is leading us toward a potentially dangerous global fight for food. While crop-based ethanol -the latest craze in alternative energy - promises a guilt-free way to keep our gas tanks full, the reality is that overuse of our agricultural resources could have consequences even more drastic than, say, being deprived of our SUVs. It could leave much of the world hungry.

We are facing an epic competition between the 800 million motorists who want to protect their mobility and the two billion poorest people in the world who simply want to survive. In effect, supermarkets and service stations are now competing for the same resources.


This year cars, not people, will claim most of the increase in world grain consumption. The problem is simple: It takes a whole lot of agricultural produce to create a modest amount of automotive fuel.

The grain required to fill a 25-gallon SUV gas tank with ethanol, for instance, could feed one person for a year. If today's entire U.S. grain harvest were converted into fuel for cars, it would still satisfy less than one-sixth of U.S. demand."

[NNadir]

27. Meat, I'd guess, is far more wasteful than ethanol ever could be.

That's easy for me to say though. I haven't had a hamburger in 30 years. I have had ethanol, though, both in my car - we have E10 here in New Jersey - and in my gut.

I stopped eating cows, pigs and various birds mostly for environmental reasons. I can't say that I miss that stuff. Actually it makes me kind of nauseous.