By Lynn Vollbrecht
Staff Writer
DELAVAN — As local farmers set out to plant their fields
this spring, they find themselves part of a global debate
about how their major crop — corn — is used.
More than 20 percent of American corn now is diverted
from the food supply to the ethanol industry to keep up
with government food-to-fuel mandates. That has created
record-high prices for farmers (see related graphic, page
5), but also price pressures on food — exacerbated by the
high cost of gasoline — that have reverberated around the
world.
“There’s no question that the idea of using corn for ethanol
has benefited farmers in Wisconsin,” said Jim Miller, president
of the Wisconsin Policy Research Institute, which supports
free markets. “(But) what does it do to the rest of the
world in terms of prices of food?”
In some cases, it has contributed to food shortages and
public unrest in Africa and Haiti. At home, ethanol production
and higher transportation costs have produced a sharp spike
in grocery prices. In a USA Today/Gallup poll released
April 22, nearly half of those responding said food inflation
has caused a hardship for their households.
“There’s no question that food prices are going up on
everything,” Miller said. “(And) when it affects prices
here, it’s going to affect prices in the rest of the world.”
Ethanol production isn’t the only culprit in higher food
prices.
“The price of the (United States) dollar has gone down
around the world,” said Peg Reedy, agriculture-education
coordinator for the Walworth County University of Wisconsin
Extension. “As a result, it is costing more to import and
export food and other products.”
Reedy added that this phenomenon has potential advantages
for Wisconsin farmers.
“Between import market increases and the rising cost of
fuel, it is becoming increasingly beneficial for grocery
stores and individuals to buy produce locally, which, in
turn, benefits local farmers and vegetable growers,” she
said.
While farmers may be seeing some benefits from higher
corn prices, some argue the benefits aren’t worth the additional
costs.
“Farmers are seeing the price tag of $5 (a bushel) for
corn, and think it is better to sell,” said Larry Nettesheim,
who owns a 150-acre dairy farm near Elkhorn. “What many
(farmers) don’t seem to realize is that with higher gas
prices and rising feed costs, the profit isn’t as much
as they seem to think.”
In Wisconsin, farmers are planting 10 percent less corn
this year, because it costs more to raise, and also because
demand for corn has produced higher prices for other lower-maintenance
crops like wheat and soybeans.
“I still plant more corn than anything else,” Nettesheim
said. “But this year I am plan to switch some of my acres
out for more soybeans, too, in hopes it might bring in
a little higher profit.”
Though corn production will be down around the state,
said Casey Langan of the Wisconsin Farm Bureau Federation,
the harvest will “still be the second-largest corn crop
that we’ve ever had.”
Miller noted though that reduced corn production will
put additional pressure on food prices worldwide, and further
stoke the food-for-fuel debate.
“Somewhere in there,” he said, “there has to be a happy
medium.”
Langan noted that the ethanol industry’s appetite for
corn is not the only reason for the increase in food prices.
“While ethanol definitely has an impact on the price of
corn, it’s not the sole driver of it,” he said.
In addition to the corn diverted to the ethanol industry,
Langan said, some 20 percent to 25 percent of the domestic
crop is exported to countries like China and Brazil, which
have expanding middle classes.
“(And) just because it goes into ethanol, it doesn’t mean
it’s not in the food chain,” he said. “Some of the corn
used for ethanol does work its way into the food chain.”
That corn byproduct, left over from the ethanol-production
process, is used increasingly as feed by livestock farmers,
who have seen corn-based feed costs spike over the past
couple of years (see related story).
While debate over corn and ethanol production rages, farmers
continue to keep an eye on the cold, wet ground. Those
who will plant large amounts of corn want to do so as soon
as possible. Though they are not behind schedule, they
are past the ideal planting date of May 1.
“Because of the recent weather, right now we are just
really behind schedule,” said Randy Papcke, whose family
has farmed land north of Elkhorn for generations.
Like many Wisconsin farmers, the combination of low-lying
areas and bad weather have already taken a toll on planting
season.
“Everyone is out in the fields, trying to get (their crops)
planted,” Nettesheim said. “With the few nice days we’ve
had, now it the time to do it.”
— Staff Writer Amy Rath contributed to this story.
