Commodities to Fuel Conference

By TIM LANDIS BUSINESS EDITOR

The annual Illinois Farm Bureau Commodities Conference, which is expected to draw 300 to 400 farmers, agribusiness representatives and elected officials to Springfield later this month, will be dominated by one topic – alternative fuels.

In fact, the conference theme is "high-octane farming" and how fuels from ethanol to biodiesel can boost farm profits.

Demand for corn- and soybean-based fuel already has helped drive prices to some of the highest levels in years – about $3.60 per bushel for corn and $9 per bushel for beans as of Thursday – said Illinois Farm Bureau senior economist Mike Doherty.

But he said the July 31 conference at the Crowne Plaza hotel also will highlight how the demand for grain as an alternative fuel affects consumer prices and even livestock producers.

"We’re still going to be what we’ve always been, the breadbasket to the country, number one, and now we have an additional role, and that is a supplemental source of environmentally friendly energy," Doherty said.

Doherty said the theme for each annual conference is intended to summarize major changes going on in agriculture. In 2007, he added, that change is clearly the boom in demand for alternative energy.

"It’s ethanol, it’s biodiesel, it’s wind energy. The whole idea is that the Midwest is now an energy resource for the country," he said.

A meteorologist and crop-forecast specialist scheduled to speak at the conference said alternative-fuel demand has begun to affect food prices worldwide. The United States also faces increased competition in alternative-fuel markets from countries such as Brazil, China and India, said Gail Martell, founder of Martell Crop Projections, based near Milwaukee.

"The worldwide energy crunch is stimulating that offshoot to make ethanol, or some other kind of fuel, out of agricultural products," said Martell, who provides weather and crop forecasts to clients worldwide.

According to figures from the National Renewable Fuels Association, the United States continued to lead the world with the production of nearly 4.9 billion gallons of ethanol in 2006, closely followed by Brazil at 4.5 billion gallons.

India produced slightly more than 1 billion gallons and China about 500 million.

Martell said production in each of the countries is only expected to grow – along with the demand for crops and food.

"It’s been driven by India, China and other very populated countries where they’re becoming more modernized and requiring more grain for feed, and they’re also using more for energy on the other hand," she said.

A series of seminars at the conference will cover a variety of other topics, such as market outlooks, animal welfare, federal farm policy, trade, technology and agritourism.

Doherty said he believes the market will balance competing demands for grain as fuel and food. Both farmers and consumers should benefit in the long run by easing reliance on oil imports, he said.

"We can provide both food and fuel. The public knows that over the past 20 years, one of the recurring problems for farmers was insufficient demand. Basically, they were growing very large crops successfully and getting very low prices. This helps improve that," he said.

(c) 2007 State Journal Register. Provided by ProQuest Information and Learning. All rights Reserved.