March 28, 2007

 

Ethanol, corn to weight heavily on the future of livestock industry
 

 

The surge of ethanol production and demand for distiller's grains will pull down cattle prices and lead to higher consumer meat prices, a Texas Cooperative Extension economist said.

 

Dr David Anderson, Extension livestock marketing economist gave his overview of the interaction between renewable energy production and the livestock industry at the recent 2007 Texas Ag Forum in Austin.

 

Anderson has enumerated the following possibilities amid the country's booming ethanol industry:

• Higher feed costs.
   
• Feeder cattle and calf prices adjusted to the price of corn.
   
• Reduced production in terms of cattle weights and profitability.
   
• A livestock industry that is less competitive in the world market.

The mushrooming of ethanol pants is centred in the Corn Belt, Anderson said, which might lead to large supplies of distiller's grains, the byproduct which is used primarily as livestock feed.

 

Anderson said distiller's grains could increase by 30 million tonnes per year at the and at considering the rate of its growth supplies can exceed demand which may lead to lower distiller grains relative to corn.

 

For each 56-pound bushel of corn used to make ethanol, about 17 pounds of distiller's grains is produced, Anderson said.

 

While the starch is taken out of the corn to make ethanol, the remaining nutrients are concentrated in the distiller's grains which have more protein and energy than corn per pound, explained Anderson.

 

Portions of phosphorus, potassium and sulfur are increased as well, he said, noting if the corn used to make ethanol had aflatoxin, "it too is concentrated three times in the resulting distiller's grains."

 

Thus, distiller's grains "presents a number of management issues related to handling and storing," Anderson said.

 

Overall, Anderson predicts livestock producers will see higher-priced feed and "lower returns and reduced profitability as well as less competitive livestock industry in world markets and regionally in the US." 

 

The following are facts about corn as it relates to ethanol production and livestock feeding.

• Products of wet corn milling: One bushel of corn can equal up to 31.5 pounds of starch, which can be further processed into 33 pounds of sweetener or 2.5 gallons of ethanol; 13.5 pounds of gluten feed, 2.5 pounds of gluten meal, 1.6 pounds of corn meal.
   
• Corn gluten can be wet or dry with moderate crude protein between 16 percent and 23 percent; it looks like oatmeal.
   
• Products of dry corn milling: One bushel of corn yields 2.75 gallons of ethanol; 17-18 pounds of distillers grains and solubles; distiller's grains are one-third the weight of the corn and but the starch is concentrated into this one-third.