NCGA's Mission: To Create and Increase Opportunities for
Corn Growers

This is Corn Commentary, the weekly newsletter for state and national grower leaders of the National Corn Growers Association (NCGA).  For complete stories and updated NCGA information, visit www.ncga.com or the NCGA Leader Resource Center, www.insidencga.com.

LISTEN TO THIS WEEK’S AUDIO STORIES:

• NCGA: USDA Projects Second-Highest Planted Corn Acreage Total in More than 50 Years   (3-31-08)

IN THIS ISSUE:

• Biotechnology Session Scheduled for NCGA’s Corn Utilization and Technology Conference
• NCGA: High Corn Prices Have Little Impact at Supermarket
• NCGA Urges House of Representatives to Protest Genetic Research for Vital Crops
• NCGA: TIME Magazine Cover Story Wrongly Attacks Corn with Questionable Research
• NCGA: USDA Projects Second-Highest Planted Corn Acreage Total in More than 50 Years
• CUTC Early Registration Deadline Extended
• Stories from this Week’s Blog

**********************************

Biotechnology Session Scheduled For NCGA’s Corn Utilization and Technology Conference
A biotechnology learning session is planned for the National Corn Growers Association 2008 Corn Utilization and Technology Conference (CUTC), to be held this summer in Kansas City, Mo. Experts will give an overview of the draft sequence of the maize corn genome and examine how its findings along with the use of genetic diversity and our growing understanding of starch biosynthesis can be used to improve the quality of corn. 

“The draft sequence of the maize corn genome just came out in February,” said session chairman Patrick Schnable, professor and director of the Center for Plant Genomics at Iowa State University.  “It’s a $30 million project that is as large as and more complex than the human genome project and has twice as many genes.”      

In addition to Schnable, panelists will include Sherry Flint-Garcia of the U.S. Department of Agriculture’s Agriculture Research Service and Martha James of Iowa State University.

Scheduled for June 2-4 at the Kansas City Marriott Downtown, CUTC will emphasize the importance of identifying the next generation of technologies to sustain corn as nature’s feedstock of the future. Click here for more information, or to register or submit a technical poster.  

NCGA: Higher Corn Prices Have Little Impact at Supermarket
When it comes to the rising price of corn, there is a negligible impact on the price of food, according to the NCGA, citing experts in the field. Farm products are a small part of the overall cost of food, and corn remains a relatively inexpensive food ingredient.

Numerous cost factors contribute to retail food prices, the U.S. Department of Agriculture points out. Labor costs account for 38 cents of every dollar a consumer spends on food. Packaging, transportation, energy, advertising and profits account for 24 cents of the consumer food dollar. In fact, farmers receive just 19 cents of every consumer food dollar.

“If corn rises 50 percent from its 2007 average price, going from $4 to $6 per bushel, that only means a per-pound price of about 11 cents,” NCGA President Ron Litterer points out. “Even a standard box of corn flakes contains approximately 10 ounces of corn – less than a dime’s worth.

And while corn is a more significant ingredient for meat, dairy, and egg production, the USDA reports that higher corn prices pass through to retail prices at a rate less than 10 percent of the corn price change.

“In general, retail food prices are much less volatile than farm-level prices and tend to rise by a fraction of the change in farm prices," Ephraim Leibtag, a USDA economist, wrote recently. And the Des Moines Register quoted Bruce Babcock, an economist at Iowa State University, saying the shift in crop acreage recently forecast by the USDA is unlikely to increase food prices at the grocery store. According to Babcock, prices for chicken and eggs have already risen because of the higher cost of corn feed, while the rise in dairy prices has more to do with strong worldwide demand for milk rather than feed costs.

Despite rising food prices, food in the United States remains an affordable part of the family budget.. Americans spend just 10 percent of their disposable income on food expenses, the USDA reports, while households in countries like India often spend 50 percent of their budget on food. Even countries in Europe spend more than twice what U.S. consumers spend on food costs. And the amount Americans have been spending on food over the years (as a percentage of their income) has decreased significantly.

Food price increases are overall stable. Over the years, with a few exceptions, food prices have followed or slightly trailed overall inflation. Recently, the USDA reported that marginal increases in retail prices due to higher energy and other costs are projected to continue and lead to food price increases somewhat greater than general inflation through 2009. After that, however, retail food prices are estimated to increase at less than the general inflation rate. For some perspective, food inflation was 4 percent in 2007, compared to the 25-year average of 2.9 percent.

In the end, growers are certain that, even with reduced acreage, they can work smart and meet all needs.

NCGA Urges House of Representatives to Protect Genetic Research for Vital Crops
The NCGA Wednesday asked members of the U.S. House to protect the focus of the National Plant Genome Research Program on crops that are “agronomically important” – plants grown to bring value back to the consumer and the taxpayer, as stated in the program’s original intent and mandate.

Pam Johnson, a farmer from Floyd, Iowa, and chairwoman of NCGA’s Research and Business Development Action Team, presented testimony to the House Commerce, Justice, Science, and Related Agencies Appropriations subcommittee and discussed the program’s successes, which led to the Feb. 28 announcement of the completion of a draft sequence of the corn genome.

“This high-quality genetic map is a foundation and the first step in creating a robust pipeline of scientific knowledge and innovation on a pathway to application and crop improvement,” Johnson said. “Access to the information encoded in the corn genome will improve water and nitrogen efficiencies, help plants cope with challenges from disease, pests and adverse weather, and allow us to tailor the crops we grow to specific end users.”

Johnson fears efforts to shift the program within the budget structure of the National Science Foundation could lead to reduced funding for the program, and urged the subcommittee to include in the FY 2009 Science, State, Justice and Commerce appropriations bill, language that secures the $101.22 million National Plant Genome Initiative budget to be applied exclusively to species of economic importance, keeping in line with the original intent of the program.

She ended her testimony by saying this effort is especially critical at this time in history, when the growing global population looks to corn and other plants to meet demands for food, feed, fuel and fiber.

Click here to review the complete testimony.

NCGA: TIME Magazine Cover Story Wrongly Attacks Corn with Questionable Research
A TIME cover story on corn and ethanol wrongly blames U.S. corn growers for causing deforestation in South America, the NCGA stated in a letter to the editor. The magazine’s report, “The Clean Energy Myth” appears in the April 7 issue of the popular newsmagazine and uses research on land use that has been questioned by a number of researchers.

“Our bottom line as proud U.S. corn growers is simple: Corn ethanol is not only good for farmers, but good for the economy and the environment as a key part of a broader, more diversified solution to energy independence and security,” NCGA President Ron Litterer said in the letter. “And we are getting more efficient and more sustainable each season in corn and ethanol production.”

The article described the way forests in the Amazon River area are being replaced by soybean farms without looking at the toll of predatory timber interests in clearing the land originally, Litterer said. It also repeated common exaggerations about the impact of ethanol demand on food prices, despite the fact that a key USDA economist found little connection. “Higher corn prices pass through to retail prices at a rate less than 10 percent of the corn price change,” Litterer noted.

Click here for the complete NCGA letter.

NCGA: USDA Projects Second-Highest Planted Corn Acreage Total in More than 50 Years
Today’s Prospective Plantings report released by the U.S. Department of Agriculture indicates farmers are concerned about high input costs, according to the NCGA. The report says farmers intend to plant 86.014 million corn acres this year, an 8 percent drop from 2007’s high acreage, yet the second-highest acreage intention since 1949, NCGA notes.

“We’re always cautious when we review the March projections, because they are made before any seeds really enter the ground,” said Ron Litterer, NCGA president. “The corn acreage projections also have a tendency to go up. Last year, for example, there was a difference of more than 3 million acres between the March estimate and the final number.” Litterer pointed out USDA’s March report has underestimated actual corn acres in the each of the last four years.

“One thing farmers have told us this year, and something I’ve seen myself, are that growers are facing tremendously higher input costs -- particularly for fertilizer and diesel fuel,” Litterer added. “We need access to more affordable sources of natural gas for fertilizer production and we’re concerned about the impact of higher crude oil prices on farmer profitability.”

The March USDA report would indicate approximately 79 million harvested acres. If the average trend yield of 155.5 bushels per acre is realized, corn producers would be on track to produce approximately 12.3 billion bushels in 2008 – the second-highest production ever. The USDA’s June 30 report will provide a clearer view of 2008 corn acreage.

“Based on what we’ve heard from our growers, and if the weather goes our way, we’re confident we will produce another good crop,” Litterer said. “We’re committed to meeting all needs – food, fuel, feed and fiber, and we are heartened by the trend toward higher yields that maximizes how much corn is produced per acre. Farmers are becoming more efficient and more productive.”

Today’s USDA report also noted that many previous corn acres are being planted in soybean, a common crop rotation. The projected 74.8 million acres would be the third-highest soybean acreage in history.
Click here to download the complete report.

CUTC Early Registration Deadline Extended
Wednesday, April 2, is the new deadline for the early registration discount for the 2008 Corn Utilization and Technology Conference. Registering by then for the Kansas City, Mo., event could save attendees up to $60 and exhibitors up to $300. Scheduled for June 2-4, CUTC will emphasize the importance of identifying the next generation of technologies to sustain corn as nature’s feedstock of the future. Click here for more information.

From This Week’s Blog:  To read comments from this week’s Corn Commentary Blog, please click the bullets below:

• Illinois Corn Asks: Ready for $4 Gas?
• Oil Companies Impact Food Prices
• Corn at the Ball Park
• T. Boone Pickens Endorses Ethanol
• Chicken Little Journalism
• Ethanol Responds to Scam Article
• Could Corn Hit $13 a Bushel?
• Corn Acres Still Historically High

To provide feedback to any of comments on this week’s Corn Commentary blog, please (click here)