Ethanol Producers Versus Beef Producers

“When our facility is completed we will produce up to one hundred and fifteen gallons per year.”

“That’s approximately thirty eight million bushels of corn a year.”

Ben Pentak works for Panda Ethanol in Hereford. Their plant will run off cattle manure from the feed yards.

“There are more cattle on feed in Hereford, Texas than any other place on the globe. There are about three and a half million head of cattle with a one hundred mile radius. They each deposit approximately two thousand pounds of manure a year, so we affectionately refer to Hereford as the Saudi Arabia of cattle manure. OPEC will run out of oil long before Hereford, Texas runs out of cow manure”

Ross Wilson is CEO of the Texas Cattle Feeder’s Association.

“We’re not opposed to ethanol production. This country needs a renewable fuel policy. We have significant concerns with an unleveled playing field that in our minds exists today because of some of the subsidies that go to corn based ethanol production.”

Gregg Doud is the chief economist for the National Cattlemen’s Beef Association.

“As the price of corn goes up, the price of that feeder steer must come down, if that feed lot is going to make any money.”

And because of tight supplies, that hasn’t happened yet.

“ In the short term this record red ink, we’re losing about one hundred and fifty to two hundred dollars a head in the Texas Panhandle right now. We’ve never lost that much money for a sustained period.”

“There’ll be two responses. Feeder cattle prices, the costs paid to a cow/calf producer will go down significantly, or our people will go out of business.”

And in the long run…

“We are not going to expand our cow herd, we may even shrink it, and that means over time the supply of beef at the grocery store will decrease, and the price of beef will go up.”

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