Livestock feed is still corn’s biggest customer

(article by Holly Jessen for Ethanol Producers Magazine, “World of Corn report breaks down corn used for ethanol, DDGS”)

The National Corn Growers Association’s annual report reveals statistics about U.S. corn production, including the amount of corn used for ethanol production and the amount of distillers grains that goes back into the feed market.

The 2012 World of Corn shows 5 billion bushels of the current supply of corn is being used for ethanol, and 1.547 billion bushels of that re-enters the feed market. That includes distillers grains and corn gluten for domestic use and a smaller amount of DDGS for export.

Corn displaced by DDGS and corn gluten in domestic livestock rations has grown dramatically from 189 million bushels in 2002, according to figures from ProExporter Network, which was cited as the source in a World of Corn chart. In 2009 the number was 1.1 billion bushels and in 2010 it was 1.2 billion bushels.

Beginning last year, the NCGA has revised the way it presents data on the amount of corn going into ethanol to reflect the amount that leaves the plant as coproducts and re-enters the feed market. Because the USDA does not account for distillers grains and corn gluten feed, it overstates the amount of corn used for ethanol and understates the amount used as livestock feed, NCGA said last year. After the Governors’ Biofuels Coalition requested USDA report corn usage for ethanol more accurately, the agency did add a footnote to its supply and demand estimates report last spring. 

Taking the DDGS production numbers into account, ethanol accounted for 27.3 percent of corn usage in 2011, according to the World of Corn report. The largest usage of corn remained feed and residual, at 36.3 percent. The 5 billion bushels of corn that went into ethanol production is down somewhat from the 5.021 billion bushels for the same use in 2010. Corn exports, on the other hand, dropped from 1.835 billion bushels in 2010 to 1.65 billion bushels in 2011.

Our Take:
Yes, this is a hungry world–it’s hungry for both food and fuel, and luckily, corn can fully supply the demand for both.

When the feed component of ethanol production–distillers grains–is properly accounted for, more than two-thirds of corn crop feeds animals while just over a quarter of the crop disappears in fuel production.

Minnesota’s 21 ethanol plants produce more than a billion gallons of fuel. That requires about 350 million bushels of corn as raw feedstock, but also returns more than a hundred million bushels of distillers grains for use in dairies and cattle herds, and increasingly for poultry and swine across the upper Midwest.

This production of energy and feed by our ethanol industry pumps an estimated $6 billion in economic activity into our state every year, and is a key element to maintaining the affordability of both food and fuel prices. Yes they are rising, but they would be headed up a lot faster without all the ethanol and distillers grains produced in Minnesota.

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