The ethanol industry has been taking some pretty severe hits lately from the popular news media, some university studies, environmental organizations, food processors, livestock organizations and some political leaders. Some have blamed the rapidly expanding ethanol industry for increased food cost, much higher livestock feed cost, short-term grain shortages, excessive water usage and potential pollution hazards. A recent university study indicated that renewable fuels may actually increase global warming concerns due to more row-crop production and added usage of fertilizer and other crop inputs. While there are questions about the validity of some of the assumptions and data used in the study – and in other anti-ethanol information – regarding new technologies and efficiencies in crop production and ethanol production that are not being accounted for, the fact remains that the strong public support toward the future development of ethanol and other renewable fuels in the U.S. may be starting to decline. This could result in more pressure on Congress and USDA to lower ethanol tax subsidies and to reduce import tariffs on foreign ethanol entering the U.S. A combination of the two would likely slow the development of the ethanol industry in the U.S., and result in a significant increase in U.S. imports of ethanol produced in Brazil and other foreign countries.
Ethanol’s Economic Impact
Not all recent data and information regarding the ethanol industry has been negative. According to a recent economic analysis of the U.S. ethanol industry released by the Renewable Fuels Association, the industry is having a very positive impact on the U.S. economy. According to the report, “Contribution of the Ethanol Industry to the Economy of the United States,” the ethanol industry impacted the U.S. economy in the following ways in 2007:
The ethanol industry is definitely having a very positive impact on the rural economy in many states, including Minnesota and Iowa, and is a positive aspect of the U.S. economy when many other aspects of the Nation’s economy are negative. For more details on the study go to: www.ethanolrfa.org.
Loss of Friend of Agriculture
Recently, the agriculture industry lost a good friend and a person who did and an excellent job of informing the general public about the correct information and facts regarding agriculture production and processing. Bill Callahan, long-time reporter at the Fairmont Sentinel newspaper, who frequently reported on current agriculture issues and wrote feature stories on agriculture, passed away suddenly during late February. He will be missed.
Editor’s note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN. You can contact him at 507-726-2137 or via e-mail at email@example.com.