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Wet Winter, High Ethanol Costs Mean Money For Corn Producers
By Mr Ethanol | May 7, 2007
HPJ:
Yuma County farmer Byron Weathers anticipates an unusual event this year: making money on his corn crop.
Like many of his corn-growing colleagues who have suffered through lean years, Weathers plans to plant more of the grain this spring to take advantage of historically high prices.
Colorado farmers will increase their corn acreage this year by a projected 25 percent to 1.25 million acres, the second-highest total since the 1930s, agriculture officials reported in early April.
Nationally, corn planting is expected to grow 15 percent to 90.5 million acres, according to a report from the U.S. Department of Agriculture.
Weathers tips his cap to a nearby ethanol plant under construction east of Yuma.
“Ethanol is a welcome boost for us,” he said. “I’ve been growing corn for over 30 years, and it’s been pretty tough for a lot of those years.”
The boon for farmers could come at the expense of cattle feeders and consumers, who are paying for the higher-priced corn.
The increased acreage is driven by demand for ethanol. That demand recently pushed corn prices to more than $4 a bushel, far higher than the $1.60 to $3.25 per bushel range for Colorado prices over the past two decades.
“There’s no question that ethanol is the driving force behind the price increase,” said Colorado Agriculture Commissioner John Stulp. “We’ve created an exciting new market for corn farmers, and it’s a very positive development.”
Two new ethanol plants are operating in Sterling and Watkins. The Yuma plant is expected to start production this summer, and a second facility in Yuma is preparing to break ground. Another plant has been proposed for Fort Morgan.
Their combined capacity of at least 340 million gallons a year would supply all of Colorado’s ethanol consumption and make the state a net “The (ethanol boom) growing pains are pretty painful for some of us. If the price of corn stays high, you’ll see fewer cattle feeders here.”
Much of the gasoline sold in Colorado contains 10 percent ethanol. Ethanol as a gasoline additive reduces auto emissions and extends gasoline supplies.
Topics: BizOp, Ethanol, Money, News |
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