The president and chief executive of Tyson, the world's largest protein producer, told analysts Monday that rising ethanol production would lead to higher meat prices. Ethanol production demand has already driven corn prices to record levels, causing a strain on meat producers using corn as feed.
"I believe that the American consumer is going to have to pay more for protein," he says. The company reported a full-year loss due to lagging sales and climbing costs.
Bond called on Washington to consider both sides of the 'food-versus-fuel' debate. Both parties in Congress currently support boosting ethanol production as part of a strategy to lower U.S. dependence on foreign oil and help the environment.
"The consumer is ultimately going to have to pay for the higher grain costs," Bond says. "The farm bill is the key in 2007."
Some ethanol producers - for instance, ADM chairman Pat Woertz - say that farmers will plant more corn in response to rising corn prices, helping to provide more feed supply for meat producers.
Bond disagrees, saying that the rising costs of corn will ultimately be passed on to consumers. However, he notes that ethanol production can benefit some producers in the Midwest who have access to byproducts of fuel production that can be used as cheap feed.