A new paper authored by Thomas Elam of FarmEcon, LLC., the same author that spurred the livestock industry's original push for a Renewable Fuels Standard waiver, estimates as much as $30 billion in lost meat production for 2013 due to increased ethanol production.
The study, "Ethanol Production: Economic Impact on Meat and Poultry Consumption, Value and Jobs," says that a large gap emerged in 2006 between the supply and demand of meat and poultry versus actual consumption, a change that Elam attributes to "rapidly increasing demand for corn for ethanol production, partially driven by the Renewable Fuels Standard."
New paper estimates as much as $30 billion in poultry, meat value lost to ethanol production
Elam's initial report on the RFS, released this summer, stirred opposition to the government program, which requires that 15.2 billion gallons of renewable fuels be produced in 2012. Widespread drought caused uncertainty about the size of the nation's grain crops, fueling concern that supply would not be adequate
to meet domestic and foreign demand for feedstuffs and renewable fuel fodder.
Elam's new study finds that ethanol production, spurred in part by the RFS, has increased faster than grain production and export volumes. He notes that feed availability and use have also been trending down since 2007, driving grain prices higher.