Grocery Manufacturers Put Forth Hype

By Rick Tolman
Chief Executive Officer
National Corn Growers Association

Regular readers of this column know I am proponent of biofuels and its benefits to our environment, economy and energy independence – and a proponent of agriculture solutions to help ease our energy woes. I am also an outspoken advocate of representing issues fairly and accurately.

I respect there are two sides to every issue and the media is the outlet for presenting those sides. However, as a keen media observer, it’s apparent the incline of the media slant is increasing. Maybe it’s the 24-hour, up-to-the-second news cycle. With such pressure to deliver, it seems fact checking has slipped. This past weekend the New York Times ran a story on bloggers feeling the stress of delivering news-breaking content in such a rapid-fire manner with some even going so far as to suggest a quiet news period each day.

Now there’s an interesting concept. Just imagine how that might reduce the media hype. The hype such as that put forth by the Grocery Manufacturers Association claiming corn for ethanol is the force behind rising food prices. Never mind the fact that the price of a barrel of oil is at an historic high and climbing. Never mind that economists tell us that a $1 increase in gasoline will squeeze your food budget two to three times more than a $1 increase in a bushel of corn Never mind the fact that a Merrill Lynch economic analyst told the Wall Street Journal that ethanol has helped ease fuel prices by 15 percent. Imagine, if you will, the impact to your food bill of another 15 percent increase in the price of a gallon of gasoline.

The GMA has a short memory as it is the same group whose members fought to stop development of drought-resistant biotech wheat. Wheat supplies tightened following a drought in Australia and short supplies elsewhere. Global demand and short supply were the culprits for rising wheat prices.

And I am not the only one to see the hype behind the GMA push. The other day, I received the email below from Bill Jorgenson, a consultant for the food industry, in response to an interview in E&E Climate with Scott Faber, GMA’s vice president of government affairs. In part, his letter states:

Scott Faber's comments from E&E News shows a disregard for fact. Biofuels do not use over a third of the corn crop, the figure is closer to 20%.

A third of the price of food commodities today is due to hedge funds, as in the case of oil, playing with markets.

Rice crops have not been impacted by acreage switch to biofuels one iota.  Yet their price has risen second to most.

Ask Tyson why they are diverting all the chicken and beef fat from operations into biofuels with a petrol partner, instead of having the fat going into feed for animals to give the energy needed to the animal.  Maybe that is one reason feed prices went up to their own operations.

Finally the choice of "burn your lunch for a ride home" when the profit margins of the food industry have risen by 50% with price increases (all not covered by increased expenses or the bottom line would not move) is what really brought me to ask if this is to divert attention or really concern. 

You can read Bill’s full letter here.

And Bill is not the only one to see through the food versus fuel hooplah. In case you missed it, Brazilian President Luiz Inacio Lula da Silva on April 3 spoke out on this issue, telling reporters: "Today there are more people who eat. The Chinese eat, the Indians eat, the Brazilians eat ... and people live longer," arguing that the growing number of mouths to feed is causing the inflation in food prices.

Producers have not lost sight of their obligation to help feed the world. Nor have the companies who are investing millions of dollars to find solutions to feed humans, livestock and ethanol plants. Our growing global population is demanding more of those of us in the agriculture sector and we have delivered.

Don’t get fooled by the hype.