July 19, 2008

Supporters Say Ethanol Gets Bad Rap

By Leslie Reed, Omaha World-Herald, Neb.

Jul. 19--KEARNEY, Neb. -- It isn't "food versus fuel," members of Nebraska's Ethanol Board said Friday.

Rather, the national debate should be a discussion of food and fuel, said David E. Hallberg of Omaha, chairman and chief executive officer of an ethanol production company and a member of the state board.

Hallberg said ethanol supporters have allowed the oil and grocery industries to mischaracterize the impact that ethanol production has had on corn prices and food costs.

"There have been a lot of attempts to influence public opinion. We're playing a game of catch-up," he said.

The Grocery Manufacturers of America and some congressional critics have argued that greater use of corn for ethanol drives up prices for corn, wheat and other grains -- and that those increases have boosted prices for bread, meat and dairy products.

The fuel's defenders, including U.S. Agriculture Secretary Ed Schafer, say ethanol is a minor factor among many. Rising energy costs, decreased global crop production due to bad weather and increased worldwide consumption are contributing to higher food prices, they say.

During Friday's Ethanol Board meeting, University of Nebraska-Lincoln researchers discussed ways -- now and in the future -- in which corn could be used both to produce fuel and provide food for humans and animals.

Rolando Flores, director of UNL's Food Processing Center, told the ethanol board that new milling techniques will allow ethanol producers to separate the fiber, fat and protein from the starch of the corn kernel.

The starch can be fermented into ethanol, while the other materials can be used for new food products and "nutriceuticals" -- foods with health benefits such as antioxidants and cancer-fighting properties.

"There are a lot of opportunities," Flores said. "There is more work to be done."

Dr. Galen Erickson, a beef researcher with the UNL animal science department, said his studies have shown that cattle gain weight faster and produce a better quality of meat if fed distiller's grain, a mashed-potatoes-like corn material that remains after the distillation of alcohol.

Erickson said cattle producers can successfully feed their animals a mixture of distiller's grain and hay, without including corn. When corn prices are high, the mixture is cheaper than corn feed.

Ethanol Board Chairman Jim Jenkins of Callaway, a rancher, restaurateur and alternative energy consultant, said ethanol has grown to a $4 billion annual industry in Nebraska, the second-largest ethanol-producing state at about 1.4 billion gallons per year.

Although the ethanol's growth has created financial difficulties for livestock producers, Jenkins said that in the long run, ethanol production and higher corn prices will benefit Nebraska agriculture.

For decades, he said, livestock producers have benefited from cheap corn, subsidized by the government.

"We've been using cheap corn as a crutch, subsidized by taxpayers," he said. "That's not a great system. Over the long term, higher corn prices are a good thing. We'll have a more diversified ag economy."

--Contact the writer: 402-473-9581, [email protected]


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