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Cowboys and sodbusters at odds again over grain
The term “sodbuster” came about during the American Civil War with the introduction of the Homestead Act in 1862. This law allowed U.S. citizens to file an application to live on and own up to 160 acres of unused federal land outside the original colonies. These were farmers who first took the plow to the virgin prairies of the Midwest and later the lands of the Western United States.
As these farmers moved west, they came into conflict with the cowboy. Cowboys drove large herds of cattle across the great western expanse and were not big fans of fences and fields. Today the western cattle rancher and the Midwest row crop farmer are at odds again. This time the dispute is not over land but over grain.
After decades of growing and selling corn at near or below the cost of production, corn farmers have finally seen prices rise to profitable levels. Cattlemen have responded with outrage and public and political attacks on what they see as the cause for the rise in corn prices: ethanol.

While the demand for renewable fuels is a factor in higher corn prices, countless studies have proven there are many and varied factors behind the move from $2 to $6 corn. In the past, the cowboys have limited their attacks to ethanol polices such as the RFS. Now, however, they are calling into question the production of corn itself, and predicting a worldwide disaster.

A recent Associated Press story stated, “The amount of corn consumed by the ethanol industry combined with continued demand from overseas has cattle and hog farmers worried that, if corn production drops due to drought or another natural disaster, the cost of feed could skyrocket, leaving them little choice but to reduce the size of their herds. A smaller supply could, in turn, mean higher meat prices and less selection at the grocery store.”

Interestingly enough, no cattle industry source was quoted in the story. But Geoff Moody, the director of energy and environmental policy for the Grocery Manufacturers Assoc., a well-funded and outspoken critic of ethanol was quoted, “We’re behind livestock producers on this issue. We believe if there is a need to ration that ethanol will eat first.”

The press has been filled with “what if” stories about all the dire consequences that will occur if corn production drops.
What makes all of this nonsense is that, if there were a catastrophic drop in corn production, there are provisions in place to reduce mandated ethanol use and production. In other words, no cows or pigs will go hungry. Also remember that a third of the corn used for ethanol is returned to the feed supply as DDGS.
Secondly, corn growers in the Midwest have shown over the past few years that adverse weather conditions do not have drastic impacts on yields. Higher corn prices have allowed corn growers to invest in new technology and genetics that make corn production sustainable.

In fact, I would suggest that corn farmers are far better able to deal with extreme weather than, say, the Texas cattle industry which literally burned up this summer under a historic drought.
Just as the Old West cowboy lost out to the sodbusters and the railroad, the modern cattle industry will need to adjust to higher corn prices and greater world demand for grain. The proudly independent western cattlemen will also need to learn that taking shots at your fellow farmers does not serve the industry well. In a modern day range war, we all lose.

The views and opinions expressed in this column are those of the author and not necessarily those of Farm World.
12/8/2011