The eyes of the poultry industry are on the federal government as it appears poised to decide whether to stop diverting more than 40 percent of U.S.-grown corn to fuel through 2013.
The move would come in the wake of a drought that has ravaged corn-producing Midwestern states.
“Thousands of jobs are at stake, livelihoods are at stake, higher food prices are at stake,” said Tom Super, spokesman for the Washington, D.C.-based National Chicken Council. “It is past time the federal government stops mandating that our food and feed be burned as fuel.”
The U.S. Environmental Protection Agency announced on Aug. 20 that it had “issued a request for comment on letters seeking the waiver of the volume requirements of the Renewable Fuel Standard,” which requires a blend of ethanol and gasoline.
A 30-day commenting period on the issue could start as early as Thursday, when an official notice is published in the Federal Register, said Mike Giles, president of the Gainesville-based Georgia Poultry Federation.
“We’re pleased that the EPA is considering the (waiver) request, as they are really obligated to,” he said. “But we’re hopeful that they’ll act on it quickly. We need immediate relief. The sooner the better for those who are suffering.”
Super agreed with that sentiment.
“We are hoping that EPA finally hears the message from eight governors, 156 members of Congress, 34 U.S. senators, livestock and poultry producers, food manufacturers and the United Nations, that it is time to act in order to (keep) a bad situation from becoming worse,” he said.
Among those petitioning the EPA is Georgia Gov. Nathan Deal, whose home county of Hall is the epicenter of Georgia’s poultry industry.
“In addition to the direct economic damage from drought within the border of our state, Georgia is heavily dependent on grain produced in other states to support its poultry and livestock industries,” Deal wrote in an Aug. 20 letter to EPA Administrator Lisa P. Jackson.
In an earlier interview, Emory Forrester, director of feed milling and feed delivery for Baldwin-based Fieldale Farms, said that 98 percent “of our corn comes from the Midwest.”
Chicken feed is composed of 60 percent corn, 20 percent soy and 20 percent other ingredients, such as minerals, Forrester said.
Fieldale uses about 11,000 tons, or about 392,000 bushels, of corn per week, “and we’re paying a high price for corn delivered in Baldwin, and this drought is only going to run it up to where it’s going to be more expensive,” he said.
Terry Barr, a nationally recognized economist at Colorado-based CoBank, which provides loans and other financial services to agribusinesses, has said that “until you get a real good fix on this crop, (corn) prices are going to stay very volatile.”
The challenge for poultry and other industries is whether to “pass (higher) costs through the consumer,” Barr said. “To the degree they can, they’ve got to continue to make cutbacks in production.”
In a weak economy, “a lot of folks are not optimistic about how much more you can push these prices,” he added.