Grainnet

The Impacts of a Growing Ethanol Industry Were Discussed Heavily During NAMA's 2007 Division Meetings in Sarasota, FL

Sarasota, FL--The weather more than cooperated for the North American Millers' Association's (NAMA) 2007 division meetings, held March 10-13 in Sarasota, FL.

During the four meeting days, temperatures routinely fell into the low 80's with slight cloud cover and a mild breeze - perfect for enjoying a round of golf.

Terri Long, NAMA's director of communications and meetings, says the attendance has remained around 220 for several years now.

The Future of Ethanol

Perhaps the only thing that outshined the weather at the meetings was the forecast for the future of the ethanol industry.

Both Dan Manternach, Doane Advisory Services, St. Louis, MO, and Jacinto Fabiosa, Iowa State University, Ames, IA spoke about the opportunities and challenges ethanol will present in the future.

Manternach answered a question that is on the mind of pretty much anyone who is involved in agriculture or an ag-related industry.

That question is "Does ethanol have the staying power to effectively create an agricultural boom?"

"A lot of farmers are asking if this is a boom, or some flash in the pan sensation that will be over as soon as it started," Manternach said.

"I think it is a boom with staying power."

Manternach went on to address issues involving acreage, how to market excess distillers grains, the effect of ethanol on corn prices, and ethanol vs. biodiesel when looking for investment opportunities.

Following Manternach's presentation, Fabiosa discussed how much growth potential there is in the ethanol market.

Fabiosa looked at many different factors when assessing the growth potential, including the price of crude oil, the price of corn, the cost of finished ethanol, price embargoes on imported ethanol, and government tax credits.

Fabiosa said the research being done at Iowa State concludes that the market has the potential to reach a production rate of approximately 30 billion gallons of ethanol per year.

Soft Wheat Forecast

In keeping with tradition, NAMA's panel of soft wheat crop specialists gave its predictions for the coming year's production numbers.

Overall, the panel estimates a total of 396,996,000 bushels for soft red winter wheat.

This forecast is up 2% from last year's 390,165,000 bushels.

Despite the expected increase in production, many panelists said a wet planting season may result in record numbers of abandoned crops this spring as more farmers try to take advantage of the premium corn prices.

The problematic planting season especially played a factor in northern states such as Wisconsin and Michigan.

In the Tri-State area (Illinois, Kentucky, and Missouri), a harsh February is expected to cause an abandonment rate of 17% in Kentucky and 12% in Missouri.

Prior to the wintry February, 71% of the Illinois crop was predicted to be good to excellent.

At the beginning of March, that number fell to 56% expected to be good to excellent.

For southern wheat growing states, quality is expected to be good.

However, yields in the southern states may be down slightly from last year.

Panel members include:

Connie Barr, vice president of customer service for Siemer Milling Company and chairwoman for the Soft Wheat Crop Report and Forecast Panel; IL, KY, MO.

Grover Van Hoose, grain buyer for The Mennel Milling Company; IN, MI, OH, WI, WV.

Shawn Blume, soft wheat merchandiser for the Lansing Grain Company; DE, MD, NJ, NY, PA.

Pat Rogers, vice president sales for Horizon Milling; NC, SC, VA and ID, OR, WA.

John Bartels, commodity merchandiser for ConAgra Mills; AL, AR, FL, GA, LA, MS, OK, TN, TX.

Josh Flint, Milling Journal editor