The Down Range Forum
Member Section => Politics & RKBA => Topic started by: MikeBjerum on February 19, 2011, 05:59:24 PM
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We have all fallen asleep at the switch, and our real problems are going to sneak up and get us. This week corn futures were over $10, soybean over $15 and feeder cattle $130! The settled down after end of week squaring and profit taking, but they are still high.
What is happening?
1. Ethanol - I am personally a fan of ethanol and have no problem with subsidies for domestic use. Oil is so heavily subsidized that it just puts it on a level playing field; if you look at the big picture it is a net gain in energy that is cleaner than oil, and if coupled with wind energy and water conservation it is a very good option. It not only gives us a fuel out of excess parts of the corn, but it condenses the nutrients to a better food source if the food industry would embrace it we would be in really good shape. However, our government is subsidizing ethanol that is being exported to other countries causing higher usage of corn and not fully benefiting anyone in our nation;
2. Cheap dollar - Our lower dollar is causing more and more nations to come to us for grain, because their money will buy more here;
3. Lower livestock numbers - Seven or eight years ago, during the third year of drought in west and south many cow/calf ranchers liquidated due to lack of feed. The problem with the cattle industry is that it is a slow process with cutting back or ramping up production. A heifer is born today and isn't bread for 14 months, nine months of gestation, and fourteen months before that calf goes to market - Three full years to complete the process. In reducing a cow/calf man sells a bred cow with calf at side and it is nearly two years before that breeding animal and its affects are out of the market, but it causes a blip in the numbers as the breeding animal hits the shelves. Bottom line is that we are lulled into a plentiful market as it happens, but by the time we realize there is a shortage it is a three year process to rebuild and the rebuilding takes a third of the market beef of the market. For swine the time frames are about half of cattle, but still lengthy and extremely expensive;
4. U.S. Weather - We have not had the best growing conditions the last few years, and have lost production in different regions. This means that we are sitting on the reserves of grains that we once had;
5. Mexico Weather - Mexico recently lost most of their crop, so they are emptying our bins to feed their livestock and themselves;
6. Elected Officials Asleep At The Switch - Many people complain about the farm programs, but it is the money spent in these programs that give the government the control over production, marketing and storage of crops to ensure we have an ample supply. As grains in the U.S. have changed over the last two growing seasons, especially since last summer, nothing is being done to lock in or restore our food reserves.
With the knowledge of how little the grain price actually reflects in a box of cereal or oatmeal, in a loaf of bread or other basics of life, the move from $3.50 corn to $10.00 corn is minimal. But when there is no wheat, corn or oats to send to the mill we need to rethink what we will eat!
Where is Pres. BHO on this situation? I'm not asking about controlling prices, investigating greed and open trading on the Board, or demonizing the ag industry. I am asking where is Pres. BHO when it comes to maintaining our grain reserves and assuring that there is a plentiful food supply for the people of this nation.
There are many things that people are afraid of, and many reasons that most think will cause revolt, but I would hate to be a governmental leader when the grocery shelves run out of $10 loaves of bread!
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Cotton prices also. Remember the CPI is skewed by our illustrious gov't folks without factoring food or energy...So the MSM can say gee there is hardly any inflation....
REALITY, check the price of bacon, cereal, and everything else.....Costs of groceries are already up 27% since 08. This is only going to increase. At some point the price will hit a breaking point.
We all eat, and use energy to heat/cool, drive, etc,....
BHO The Enabler,.... Francios Piven, and Puppetmaster Soros,....just biding their time...hoping for revolt. We have also enabled, fallen asleep, and let our politicians dictate a course of action leading up to this.
We give more grain to world charities, Russia, et al,....that I'm not sure who will step up, from either party, to stop it.
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A lot of good information but I have to disagree with you on the ethanol. When you start burning food to move your vehicle, something just ain't right. Mexicans can't afford tortillas on account of corn being used to make the kind of fuel that eats the insides of fuel pumps, injectors, valves, and the tops of pistons. We have all the fossil fuel we need right here in the good old US of A if the buttheads on DC would just open up the territories. Farmers can't feed their cattle. Everything that's agriculturally based gets an elevated price tag.
Ethanol is crap as a fuel--unless we start using true waste products to produce it. They do it in Brazil. Why not here?
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Count me with Crusader Rabbit.
Wind, solar and hydro power are good, the fuel costs nothing, it can be generated any where on the planet and there are no limits on recycling it, one breeze will power a hundred windmills just as easily as it will one.
Burning food is stupid, it's bad for engines, causes a rise in food prices and takes food out of peoples mouths.
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Dittoes to the above. Ethanol from corn is a waste. Hell, I pay $4 a gallon at the marina vs $3 at the store to make sure I don't put that crap in my out board. Using sugar cane ala Brazil seems smarter. Still, as Crusader notes, when folks can't afford tortillas, or corn oil to cook with in the third world, they tend to get testy and for very understandable reasons. The thing is we have it in our power to feed most of the world and make a profit on the deal. Why the hell are we allowing the government to screw up the market place by subsidizing corn ethanol as opposed to growing corn for food? Oh, right, Iowa is the first Presidential caucus. Does this make any sense?
FQ13
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Crusader, the thing that has been missed in the ethanol system since it went "big time" is the value of the by product. When farmers were distilling on the farm every bit of the residual went through livestock. Our problem as a nation is that we have not learned (or more accurately, are not willing to convert our ways) to use DDG in human foods. In the late 70's it was learned that the best thing we could do was to quit selling our corn and wheat to starving nations, and begin GIVING them our DDG. They would receive better nutritional value and we would actually be neutral to slightly better off financially.
The protein level of the corn is 11% and in Dried Distillers Grain (DDG) it is 23%. By replacing some of the corn with DDG you can utilize other products in the feed, and you can lower the soybean meal. By utilizing DDG in our cereals and cooking products we would improve the nutritional value of those products. When we were feeding DDG I made a batch of corn bread replacing half of the corn meal with DDG, and nobody noticed. Based on the nutritional charts the lowered starches made it a better food for us.
When I was growing up and spending time on the farm every farmer two generations beyond me, and my father-in-law also, had diversified farms. They had dairy, swine and poultry. They would run fattening hogs in the cattle lots to clean up all the wasted feed and the undigested grain in the manure. They would sell some milk whole; but much was separated and the remaining whey was fed to the pigs as well, and manure from all over was put back on the land with very little added. Today dairy farmers sell their milk whole and most whey from processing is dumped on land or down the sewer. Recently plants have popped up that will remove whey for use in energy bars, but they only reclaim 30% - 50% and the rest is dumped. We will never go backwards completely, but most modern agriculture has lost some valuable lessons from the past.
As much as I hate government interference in private business, this is an area I wish the USDA would step in on. Require a percentages of these exports of corn to be replaced by DDG.
As far as danger to engines, the only things you need to change in your vehicle, GM that is, is the fuel pump and injectors. That is the only difference between the regular and flexfuel vehicles. The sensors are all the same, and the computer adjusts the mixtures within 50 miles (keep that in mind if you are using blender pumps and changing your blend every tank). Most people up here use the E85 and base their decision on the 15% rule (E85 is advertised as getting 15% less mileage, so if they can save 15% or more on price they can break even or save money). Friends report that most GM's see a 5% reduction in mileage, Chryslers are close to 15%, with Ford somewhere in the middle, but close to GM.
As far as why farmers like ethanol - If we as citizens would be willing to pay them cost of production for their crops it never would have taken off. When we quit (went broke) farming I was selling corn for slightly over $1.00 per bushel. The government was giving me another approx. $0.50 per bushel on a portion, and they were paying me to store it in reserve for a number of years. The demands of the public for cheap food in the past combined with the current administrations lack of management of a stable reserve are what is driving much of this.
As for cow/calf producers - Imagine ranching in the western Dakotas, Montana, Wyoming, Colorado, Utah, and a few other areas and using government leases for junk land. You are balancing on minimal feed for your animals and trucking in feed from hundreds of miles away. Then you have protesters and liberal politicians at best looking to raise your rents, but more accurately trying to force you off the land. Then enter people like Ted Turner and Jane Fonda and their friends, and conservation groups buying up millions of acres of land to stop ranching. Many of these ranchers are just saying that the return isn't worth the ulcers.
Another major factor we face is that most residents in this nation are two, three and even four generations removed from the land. Very few Americans know or understand where their food comes from. And even worse, most would starve to death looking at a fertile backyard and packages of seed.
My passion in this is where it ties in with the gun culture: Most people are so busy demonizing "change" that they miss all the good and benefits. The hot button issues today are Genetically Modified Organisms (GMOs), Ethanol, and antibiotics and hormones. GMO - Most people are blind to the fact that all GMO is is lab work that does in months what the farmer used to do over years in the field. It is creating hybrids by crossing plants to gain benefits. Whether crossbreeding or grafting nobody complained until they found it could be done overnight in the lab. Ethanol - I've pretty well beat that horse to death or at least it smells that way. Antibiotics and hormones - This did get out of balance in the fifties and sixties, but today it is pretty well used in the animal industry just like the human medical field.
I should quit looking at posts left to 200K and start looking at word count on my rants.
Bottom line - If you like meat take advantage of every sale and fill your freezer. Plant your gardens and learn to can foods. And make friends with a farmer or ten, because they are the ones that can raise what we all need.
Do you have access to a garden spot? A patch 20' x 60' of well managed soil will yield you 60# of edible dry beans, or 500 ears of sweet corn, or 120# of oats, or 60# of wheat. In a raised bed 3' x 20' a person can raise 200 onions, or 200 average red potatoes, or 100 quarts of tomatoes, or more cucumbers than I care to remember. My strangest experiment was to expand the kitchen herb garden on the window sill. I learned that a well managed 1' x 6' planter box sitting inside a south facing window will keep a person in fresh salad greens for a large salad every day.
Now that I have entered volume four of my rant I have also crossed from ripping our government's miss management into personal responsibility and preparedness.
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The numbers on ethanol do not work out. More fuel generating less mileage at higher temps creating more wear causing the engine to fail sooner.
Best bet is like with the banks.
Let the house of cards collapse and then revert to the things that actually worked.
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Count me in with Tom, Crusader, and FQ. The whole Ethanol fiasco is nowhere. Brazil has the climate along with millions of acres to grow sugar cane to produce it. We don't. As was said, it's expensive, doesn't produce as much power per gallon, and it eats up engines in short order. Look at all of these stupid "Flex-Fuel" vehicles. You can't even buy this E-85 crap they were supposedly designed to run on. I have yet to see a pump that sells it in the entire Phoenix Metro area. It costs more and gives less mileage and power.
We would be better off going to Compressed Natural Gas technology to run vehicles. It's avaliable here right in your home, and it's cheap. Forget solar and wind as well. The technology VS. cost isn't there yet. T. Boone Pickens lost hundreds of millions with his "plan" to make it work. He couldn't and it didn't. Bill T.
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It does skew food prices significantly worldwide. Not only corn, but all production because there is more profit in corn so less beans or wheat are planted.
We have cut food grain production, shrunk our dollar, and oil has tripled in price since BHO took office.
It is going to hurt us, it will absolutely CRUSH other nations. What are people going to do when they used to spend 50% of their income or more and you double food prices?
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Here is some interesting reading from Frank James.
http://frankwjames.blogspot.com/2011/02/planted-acres.html
..."Many are going to blame the 24% to 27% of the domestic US corn crop that goes into ethanol production, but that makes no more sense than someone else saying the Chinese and those in India are at fault because they driving the price of these grain commodities above previous values.
The bottom line is the world, not just the US population, has become complacent about food production. Everyone takes it for granted, but Mother Nature has a way of reminding everyone from time to time that NOTHING IS FOR SURE OR GUARANTEED..."
http://frankwjames.blogspot.com/2011/01/not-good-road-warrior.html
"...The grain market has taken off and many feel it has a ways to go yet. I'm not sure but what I'm reading off the market reports and summaries being emailed to me simply don't make sense. Essentially the market is presently bidding for acres. The market feels there needs to be 92 million acres of corn in 2011. That's fine and dandy, but here's the catch.....Last year we had 88.2 million acres of corn and the year before that we had 86.5 million acres. How do you manufacture tillable farm ground?
In 2007 we did have 93.5 million acres in corn production, but those acreages came at the expense of wheat and soybean acres. Everyone today is saying soybean acres for 2011 are going to be at maximum. By comparison the new crop prices on soybeans are even higher than corn is. We could lose some wheat acres, but usually you can't grow corn where you grow wheat.....because they DON'T get the rainfall necessary to grow corn."
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Well, how many acres does the USDA pay to keep out of production?? They just renewed CRP again.
And don't forget water rights. You can't grow more crops in many areas unless you get more water.
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Well, how many acres does the USDA pay to keep out of production?? They just renewed CRP again.
And don't forget water rights. You can't grow more crops in many areas unless you get more water.
I'm not sure water rights affect corn or soybeans but it has caused huge problems with truck crops in CA. Stoping irrigation to protect a darter has caused a major changes in farming and the economy of the Central Valley.
CRP? Well taking marginal acreage out of production does help water and soil conservation. If demand for grain increases then some changes will be coming.
And 2011 weather? Who knows.
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oil has tripled in price since BHO took office.
That is exactly what he wants. He likes high gas prices because it is forced conservation in his eyes. The more people who buy the little "green" $h!tboxes he wants to see everyone in, the better. He doesn't care how it happens, just as long as it happens. Bill T.
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Well, how many acres does the USDA pay to keep out of production?? They just renewed CRP again.
And don't forget water rights. You can't grow more crops in many areas unless you get more water.
CRP ground doesn't produce enough crops to make a difference. CRP is wetlands, highly erodible slopes and/or soil types. that do not produce well.
It is like when they had set aside acres. They would try and drop production by 8% by having a 10% set aside. Farmers would put their crap ground in set aside and production would only drop 3%. At the peak in the 80's we had a 20% set aside and I still had to build a new bin for the production.
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Well, how many acres does the USDA pay to keep out of production?? They just renewed CRP again.
And don't forget water rights. You can't grow more crops in many areas unless you get more water.
According to the USDA 30 million acres in CRP set aside.
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CRP ground doesn't produce enough crops to make a difference. CRP is wetlands, highly erodible slopes and/or soil types. that do not produce well.
It is like when they had set aside acres. They would try and drop production by 8% by having a 10% set aside. Farmers would put their crap ground in set aside and production would only drop 3%. At the peak in the 80's we had a 20% set aside and I still had to build a new bin for the production.
It is SUPPOSED to be that way. Some places it still is, but many places it is good land--between the farmers (or off-farm land investors) that do or don't sign up and .GOV regional quotas it doesn't always end that way.
The REALLY bad land was already out of production so didn't qualify to be get in to CRP.
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Can't speak to other regions of the U.S., but in ours it is all crap land in CRP. The non-farmer recipients are the ones that purchased the crap land from the farmers for hunting (mostly) or conservation (a few whack jobs that cause nothing but trouble when they come down to "reconnect with nature.")
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Here it is no worse that land in production, it is a matter of which farmer jumped through the right hoop.
All the land is marginal around here, though. Most of it would qualify if purely based on erodibility or fertility, but since the region only gets X $'s for CRP--our standards to get in are higher (lower) than other regions. The worst land in Iowa is probably better than the best we have for example.
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First, not a huge fan of ethanol, especially from corn. There are much better things with which to make it, if you're dead set on making it.
Second, I think CRP land is generally a good thing. I've dealt a little with implementing it, and worked quite a bit on managing it. I know that it can be a little iffy on who gets to sign up for it and who doesn't, but that's mostly internal FSA crap. Most of the land I've worked on wouldn't be that great of farm land anyway (in Western KY). With that said, properly managed CRP provides much needed habitat for wildlife. It's generally good for quail, rabbits, and other upland species (think random birds that don't get any respect). CRP is a very broad term that covers many practices with various goals. It includes stream buffers, field borders, conversion to native warm-season grasses, hardwood restoration, I think there are some grazing version, and other things.
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In an actual market economy, you and me vote daily with our pocketbooks, we pick the winners and losers, that is economic freedom, when the federal government steps in and picks winners and losers, we have economic tyranny. Subsidies for no one!