Yields and export demand have managed to draw down the nation's supply of feedgrains. The outlook is generally bullish for producers. But new numbers indicate the competition for the land that grows crops is growing.
And demand for feedgrains is becoming more complex than just providing rations for livestock. For years farmers and farm state lawmakers have championed the cause of ethanol as a means of capturing value of grain. It now appears the infrastructure for wide spread ethanol fuel is becoming a reality.
With an energy bill pending in congress, ethanol facilities have been ramping up production in anticipation of increased alternative fuel mandates. As a result, ethanol facilities in the U-S continue to set new production records. Total production in 2002 is expected to hit an all time high of two billion gallons.
Much of the increase is attributed to the propagation of ethanol facilities. By the end of 2002 it is anticipated there will be 69 operational ethanol plants with an annual maximum capacity of two-point-seven billion gallons. A mandate in the Senate version of the energy bill would require use of two-point-three billion gallons of ethanol by 2005 and five billion gallons by 2012.
The excitement spawning ethanol production facilities can be seen in a recent round of U-S Department of Agriculture Grants for value-added ventures. Twenty-two ethanol-related ventures in 16 states were awarded more than five-point-five million dollars. Secretary of Agriculture Ann Veneman touted the grants as part of the Bush energy plan which includes provisions for expanded biofuels use.
While ethanol production is increasing, farm acreage is shrinking. According to a report by the American Farmland Trust, or A-F-T, the U-S is currently losing an average of two acres of prime farmland per minute.
Statistics would suggest that rate of loss will only continue to increase. The amount of land moved out of agricultural production in the 1990s was twice that of the previous decade. The A-F-T claims the loss is largely due to urban sprawl and cites statistics which show housing lots consisting of 10 acres or more account for 55 percent of land development in the past eight years.
According to the A-F-T, land most likely to be developed for non-agricultural purposes includes 86 percent of all fruit and vegetable acres and almost two-thirds of the land devoted to dairy use.