Abit Massey put into context an agricultural industry in Georgia that is both thriving and facing stark challenges — one of them being ethanol production.
Massey, president emeritus of the Georgia Poultry Federation, spoke at the Hall County Farm-City Breakfast held Wednesday morning at the East Hall Community Center.
The issue of the hour was ethanol production and subsidies, which have negatively impacted agricultural industries, Massey said, hitting close to home for Georgia’s poultry farmers.
Massey stressed the pertinence of the issue in Hall County.
While business and technology industries are growing in Hall County, agriculture production and tourism remain a staple of the local economy, especially poultry, he said.
“The farm value of poultry in this area would be larger than the total statewide value of the next six commodities — cotton, peanuts, pecans, corn, hay, soybean and a couple of others that you can throw in,” he said.
The issues surrounding ethanol are a complex blend of geopolitics, Massey pointed out.
Congressional legislation passed in 2005 mandated higher renewable fuel standards.
The legislation specified that 12.5 billion gallons of ethanol be used for gasoline every year, with a 52 cent subsidy per gallon for ethanol.
But the bill had many unintended consequences, especially for Georgia, Massey said.
From fall 2006 to August 2012, there has been a relentless rise in corn prices, Massey said, accounting for a loss of $22.5 billion in the poultry industry.
The University of Georgia calculated that the increase in corn prices, added to the drought in the Midwest, is costing the Georgia poultry industry an extra $1.4 million every day.
Eight poultry companies have gone bankrupt over the last eight years, Massey said.
In 2011, a 54 cent per gallon tariff on ethanol was eliminated, as were the subsidies and tax credits, Massey noted.
“But the mandatory use of ethanol is still in the law,” he said.
He expressed hope that Congress will eventually repeal the entire law and “let free enterprise operate as it should.”
The implications of the legislation are also notable because of the state’s export presence in the global poultry industry, Massey said.
“Georgia, if it were a country alone, would be the seventh largest poultry producer in the world,” Massey said.
But good news is not on the horizon for future growth, he said.
“According to USDA, the U.S. is the only country anticipated to decline its share in the poultry exportation, due to ethanol,” Massey said.
The top other exporters of poultry include China, Brazil and India, he noted.
“It’s a difficult level of competition,” he said.