Citing a shrinking number of farmers who can compete in commodity-driven production, the National Corn Growers Association (NCGA) released a report outlining opportunities in value-added enterprises such as ethanol plants.
The report, "Taking Ownership of Grain Belt Agriculture," was released at the Commodity Classic, held in Austin, Texas Feb. 23-26 and stressed entrepreneurship over entitlements, according to NCGA president Leon Corzine.
"Producer investment, not reliance on government programs, is the key to the future of American agriculture," he says, citing ethanol as a key value-added enterprise for corn farmers. "Producers need to take their investments closer to the end user to improve their bottom lines."
The report highlights operations whose business models or experiences could be valuable to growers considering similar ventures. The report makes specific policy recommendations that will make it easier for producer-funded entities to grow and form the economic backbone of rural America.
"The future viability of rural America is largely dependent upon agriculture changing to reflect the economic realities of a global marketplace," Corzine says. "The economics are not always on the side of a commodity-based operation. This reality impacts farmers, their families and the communities where they live and work."
Producers who have invested in ethanol plants and other value-added operations are moving away from relying solely on commodity-based agriculture, he says. "Ethanol no doubt represents the greatest value-added and rural American success story for producers. Those who sell corn to an ethanol plant gain an additional dime per bushel, while those who own an ethanol plant have a much greater opportunity for return."
Corzine fielded questions on a variety of topics during the press conference:
Administration's budget proposal:
"Our policy continues to be, we support the 2002 farm bill as it was passed by Congress," says Corzine. "Hey, this was a contract between family farmers and the U.S. government. We've made a lot of plans counting on this farm bill going to its entire length as it was intended to.
"We feel like corn is taking an unfair hit when you look at the total budget proposal. They cannot balance the budget on agriculture.
"When prices are high, we don't get that much government support and that's the difference in our programs. When we need the help the most is when prices go down, then programs help farm income. That's when we get a chance to talk about food security for this nation."
Treasury Department restrictions on trade with Cuba:
"We were not happy with this reassessment. Here we are, trying to be market driven, and yet we're restricting trade with one of our closest (geographically) trading partners."
"We hope the new faces in Congress will have a positive outcome. It is a big, complex bill. We're hoping to have this introduced early so it doesn't get too political. We have bipartisan support. It never moves forward quickly enough, but we think we're going to get it this year."
Brazilian ethanol imports:
"We don't consider it a threat to our market. We've grown the demand for ethanol, and sometimes imported ethanol helps take the pressure off that demand. I've heard concern among grassroots people, are we going to oversupply ethanol - then the next day we hear, gosh, we've built this demand, can we supply it? Everything is growing so quickly. I'm confident the way we're structured we will be able to compete - we're going to be up to 81 (domestic) ethanol plants very quickly. We're for fair trade and we believe we can compete."