RFS not hurting cattle profits

Is increased ethanol production hurting beef cattle and dairy operations? The answer is NO according to a recent Texas A&M study detailing that cattle operation profits have increased since the implementation of the renewable fuels standard, which mandates that certain amounts of renewable fuels be used in the United States each year.

The study originated from allegations that increased corn ethanol production was causing instability and uncertainty in beef and dairy operations. While the analysis did show an increase in feed prices, the overall profits outweighed the increased costs.

“For years, corn farmers have understood that we have the ability to supply both growing ethanol and livestock producers simultaneously without negatively impacting these valued customers,” said South Dakota Corn Growers Association President, Gary Duffy, a farmer and rancher from Oldham. “With advances in both seed and farming technology, we have increased our average yield substantially in the past few decades. This abundance allows us to meet increased demand, providing both feed and fuel that benefit our nation’s economic security.”

Not only does this study answer the questions of those in the livestock industry, but it reassures our countries’ policy makers that the Renewable Fuels Standard is truly an effective program that is not hurting other facets of agriculture. The study also extinguishes yet another anti-ethanol myth.

 “While it is easy to reiterate artificial arguments against the use of ethanol, we believe this study clearly illustrates the fallacies on which they are often based,” said Duffy. “This study again concludes that, in reality, we do not have to choose between using corn for food or fuel.”

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3 thoughts on “RFS not hurting cattle profits

  1. Jim Burg

    Good article. Livestock feeding profits are as good as I have ever seen and feeder prices are at recod highs. Also the availability of DDG greatly improves feed efficiencies.

  2. Jim

    You might want to check with the feedlot people on these facts and the purpose of this report…
    “This analysis represents a partial look at the cattle
    industry in that it only examines cow-calf production.
    No stocker operations or feedlots are included. Cow-calf
    production uses little purchased feed relative to total costs because ranches rely on grazing pastures and range”

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