I wonder if Grier's point about the ethanol industry driving pork and beef producers out of business is accurate?
In Canada, I suspect the run up in the value of the Canadian dollar has been as damaging, I know Kevin said it has only had a little impact...$.63 to $1.03 is a big jump...
He also did not discuss that alot of this is being driven by $100 per barrel oil.
I liked his response to the GFO study: "How is it going so far?"
What do other cash and livestock producers think?
I think the disagreement will follow the sector lines.
Of course there will be a division between the industries! I estiamte that ethanol production cost me aproximately $75 to $90/ hd. on the short yearlings I sold this spring. But that's O.K. - clearly Suncor and Greenfield need the money worse than just a disposable cow/calf guy. And the distillers return so much to our local economy - not.
Where is the justice in one feed grain user receiving a subsidy while another independent and more diversified user (who is traditionally the biggest and steadiest user) is forced to compete against a subsidized buyer?
And not to mention the fact that the unfair competition for grains is hitting the beef and pork sectors at just about the worst time imaginable with both meat sectors coming out of some of their worst financial years ever.
But there are other factors to consider. How about looking at how well the ethanol industry would be doing if all government subsidies were removed?
And what if we were to look at the true economy of ethanol from a comparitive fuel mileage perspective? Reports indicate that fuel economy is as much as 20% poorer - the higher the level of ethanol, the worse the mileage.
We have no true market test of what the product is worth. Until there is, it is nothing but another corporate welfare system.
It is way past time that the governments of this country get away from meddling in the market place and stay with their intended mandate of maintaining law and order. Because when outside money comes into play, all objectivity becomes skewed and affected parties begin to produce according to government policy rather than market realities.