Kristin Olsen, October 11 – Our California dairies have suffered immensely in recent years due to a variety of factors, including low milk prices; but one major factor is the exponentially rising cost of feed.
The federal Renewable Fuel Standard program is the primary cause of this cost challenge because it mandates that gasoline consist of up to 15 percent corn ethanol, which uses the same corn farmers use to feed their livestock.
The competition between the corn market and the government corn ethanol mandate is creating grave challenges for our California farmers, and their ability to feed their livestock and, ultimately, the nation.
Thus, I drafted Assembly Joint Resolution 21, which was passed unanimously by the State Assembly and Senate. AJR21 provides a clear message to Congress that California lawmakers support eliminating corn-based ethanol requirements, capping the amount of ethanol that can be blended into conventional gasoline and urging the EPA to transition away from biofuel sources that compete with food production.
The price of corn and ethanol has risen dramatically in the last eight years. In August 2004, the market price for a bushel of corn was $2.40, but by August 2012, that amount had almost tripled to $6.28.
Corn prices have risen so much for two reasons: Droughts that left farmers with less crop yield and the diversion of corn for fuel purposes.
California leads the nation in milk production, and dairy cows primarily depend on corn as feed. These higher prices have contributed to hundreds of California dairies going out of business and have increased costs on consumers through increased food prices in grocery stores and restaurants.