Noticias
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OVERVIEW:
* NEBRASKA CORPORATE FARMING BAN STRUCK DOWN
By Bill Hord
* EIGHTH CIRCUIT UNDERCUTS STATES RIGHTS; DELIVERS BLOW TO FAMILY AGRICULTURE
By National Farmers Union
* PRIVATE-EQUITY FIRMS CONSIDER BID FOR AHOLD'S U.S. FOODSERVICE UNIT
By Henny Sender
* SO WHAT'S THE BIG DEAL IF WAL-MART MAKES A MISTAKE
By Jim Goodman
* LARGEST WORKPLACE RAID EVER
By Mike McPhee
* IMMIGRATION RAIDS MAY AFFECT MEAT PRICES
By Associated Press
* MEAT PLANT RAIDS MAY SPUR REFORM
By George Raine
* PRESSURE MAY BUILD TO PLANT RESERVED CROPLAND
By Philip Brasher
* WHAT ABOUT THE LAND ???
By Julia Olmstead
NEBRASKA CORPORATE FARMING BAN STRUCK DOWN
By Bill Hord
Omaha World-Herald
December 13, 2006
LINCOLN, Nebraska --- A three-judge panel of the 8th Circuit Court of Appeals in St. Louis today ruled that Nebraska's ban on corporate farming is unconstitutional.
The panel upheld a ruling last year by U.S. District Judge Laurie Smith Camp that struck down the ban, enacted as Initiative 300 by Nebraska voters in 1982.
I-300 has been considered the toughest restriction in the nation on farming by non-family corporations. Its demise also could bring an end to corporate farming bans in five other states.
Smith Camp had ruled that I-300 discriminated against out-of-state investors by requiring that one member of a Nebraska family corporation be involved in the day-to-day operation of the farm.
An appeal is nearly certain, said Nebraska Farmers Union president John Hansen, one of the leading proponents of Initiative 300. "But that decision has not been made yet," Hansen said. Hansen said the panel's ruling was under review by the Attorney General's Office and other lawyers who are involved as defenders of I-300.
Before Smith Camp's ruling last year, Initiative 300 had withstood numerous court challenges over its 24-year life. "This is not a good day," said Hansen.
The appeals panel upheld Smith Camp's determination that Initiative 300 violated a federal constitutional provision that limits how much states can regulate interstate commerce.
An appeal would first go to the full 8th Circuit Court. If again upheld, an appeal would go to the U.S. Supreme Court.
The original case was brought by former State Sen. Jim Jones of Eddyville and five others who said the ban restricted their right to benefit from corporate business practices.
EIGHTH CIRCUIT UNDERCUTS STATES RIGHTS; DELIVERS BLOW TO FAMILY AGRICULTURE
By National Farmers Union
December 14, 2006
The 8th Circuit Court of Appeals delivered a blow to states rights and family farming Tuesday, when it ruled in St. Louis that Nebraska's ban on corporate farming, known as Initiative 300 (I-300), is unconstitutional.
I-300 bans non-family farm corporate farming, but also serves as an effective ban on packer feeding of livestock.
"Given the massive acceleration of meat packer concentration in agricultural markets in recent years, the failure of federal Justice Department anti-trust enforcement and the failure of USDA's Packers and Stockyards enforcement of anti-trust, the last thing rural America needs is for the courts to take away states' ability to deal with the problems of agriculture market concentration and non-competitive markets," NFU President Tom Buis said.
Farmers Union has been a long-time leader and supporter of this amendment --- Nebraska Farmers Union spearheaded a 1982 citizens' petition drive to add the ban to the state constitution. The amendment prohibits non-family farm corporations from owning farmland or engaging in agricultural activity, with a number of exceptions.
In December 2005, the U.S. District Court for Nebraska struck down I-300 on the grounds that it violates the U.S. Constitution by discriminating against out-of-state corporations. Nebraska's appeal, filed with the 8th Circuit Court of Appeals, seeks to reverse the December 2005 decision because I-300 promotes family farming and keeps rural communities viable.
"It is very disappointing that two federal court decisions have been made based on 'facts' that may or may not be facts," Nebraska Farmers Union President John Hansen said.
"The people who voted to put I-300 into our state Constitution have not yet had their day in court. There has been no trial to determine the validity of the claimed facts, all of which are in dispute in this case. The 8th Circuit Court denied us, yet again, our right to a trial."
The Farmers Union leaders said that the implications of this case are far reaching, as the decision uses the dormant commerce clause to strike down the state's right to set its own standards. If this case stands, it will weaken the ability of all states to determine their own standards for the conduct of commerce.
PRIVATE-EQUITY FIRMS CONSIDER BID FOR AHOLD'S U.S. FOODSERVICE UNIT
By Henny Sender
Wall Street Journal
December 16, 2006
Private-equity firms Clayton Dubilier & Rice Inc. and Kohlberg Kravis Roberts & Co. are in talks to acquire Amsterdam-based Ahold NV's U.S. Foodservice unit in a leveraged buyout that would value the unit at more than $5 billion, according to people familiar with the matter.
Meanwhile, other private-equity firms, including Blackstone Group and Texas Pacific Group, are also considering a bid, according to people familiar with the matter.
Ahold, long the object of attention of private-equity firms, denied that the whole company was for sale. The company also has been the subject of merger speculation in recent weeks. Ahold declined to comment on any merger activity, but said it was large enough to stand alone. The company's market value is about $16.7 billion and about 74% of its sales are in the U.S.
The news of the talks, reported by Bloomberg News, comes as part of a blitz of deals capping a frenetic year for private-equity firms. KKR along with Permira Advisors LLP, Thursday announced it was buying ProSiebenSat.1 Media AG in a deal valuing the German broadcaster at almost €6 billion, or nearly $8 billion, from a consortium of private-equity firms and investor Haim Saban. Meanwhile, earlier in the week, Texas Pacific was part of a club acquiring Qantas Airways Ltd. in a record buyout for Australia.
Ahold's U.S. Foodservice division supplies food to restaurants and hotels. In 2003, the division was at the center of an accounting scandal that forced Ahold to restate earnings by nearly $1 billion. Ahold had improperly recorded rebates and discounts vendors paid to the U.S. Foodservice as revenue. Ahold also paid more than $1 billion to settle a shareholder's lawsuit brought following the scandal.
The company said it will retain ownership of the Stop & Shop and Giant supermarket chains in the U.S. In an interview, Ahold Chief Executive Officer Anders Moberg made the case for keeping the U.S. chains, which are mainly in the Eastern U.S. "We have the knowledge, the management and I can't see anybody else doing a better job," he said.
Private-equity firms have a lot of experience with food distribution companies such as U.S. Foodservice. CDR, for example, bought Alliant Foodservice from Kraft Foods in 1995 and sold it to US Foodservice in 2001, making six times its money in the process.
Ahold has announced it was putting its Columbia, Md.-based food-distribution business up for sale as part of a major restructuring. . . . .
Stefan Simons contributed to this article.
SO WHAT'S THE BIG DEAL IF WAL-MART MAKES A MISTAKE
By Jim Goodman
December 14, 2006
That was the question asked by the host on a recent Public Radio call-in show. Her question to her guest from the Cornucopia Institute was in regard to recent charges that Wal-Mart was passing conventional grocery items off as USDA certified organic.
A mistake? I doubt it. Seriously, think about it, you start a big push in marketing a new line of high profit products and one of the first things you do is mislabel your products, “accidentally”? As Jim Hightower would say “Do they think we were born with sucker wrappers around our heads?”
Ever since Wal-Mart announced earlier this year that they planned to greatly increase their organic offerings at a cost of only ten percent more than their conventional foods, those of us who grow organic food have been skeptical.
Now it appears our skepticism was well placed. I personally felt the worst we might expect would be imports of cheap “organic” food from China, but hey, why not go for the gold, just sell conventional food as organic.
There was much excitement about Wal-Mart expanding their organic sales and how it would do so much to help organic farmers, huh? did Wal-Marts entrance into the conventional grocery business help conventional farmers, did their profits go up? Hardly, but it did put lots of small grocery stores out of business and certainly added more black ink to Wal-Marts multi-billion dollar bottom line.
In its short history as an organic retailer Wal-Mart is already under scrutiny for sourcing its organic milk from a factory scale dairy that is under investigation by the USDA for failing to comply with federal organic regulations. It would also appear that they have no qualms about selling organic produce from China as long as it's cheaper and more profitable than sourcing from the U.S, but then Wal-Mart is an old hand at offshore sourcing, just ask the U.S textile industry they helped ruin.
I wonder if a Wal-Mart mistake was the reason 1.6 million women have joined in a civil rights lawsuit against Wal-Mart? This action, now the largest class-action lawsuit in history charges Wal-Mart with sex discrimination in pay and promotions.
When an Oregon jury found Wal-Mart guilty of systematically forcing workers to work overtime without pay, the evidence obviously pointed to more than just a “mistake” on the part of Wal-Mart.
On ten separate occasions the National Labor Relations Board has ruled that Wal-Mart broke the law when it fired union supporters. A mistake, or are they just slow learners?
“A pattern of national disregard by Wal-Mart” was how Connecticut Attorney General Richard Blumenthal described the company's adherence to environmental protection laws. More mistakes, or just their way of doing business?
In Wal-Marts tightly structured business model everything is controlled down to the temperature and in-store music) from the head office in Bentonville Arkansas. The home office knows exactly whats going on in the stores and they certainly didn't become the worlds largest retailer by making mistakes.
Everyday Low Prices, the Wal-Mart slogan, wins the hearts of many because “poor people can afford to shop there”. Those low prices are kept low by the exploitation of international sweatshop laborers, driving competitors out of business and paying their associates wages so low they must turn to Medicaid for health insurance and often buy their cloths at Goodwill.
Wal-Mart does have a history, a history of low wages, union busting, sweatshop exploitation, discrimination and doing whatever it takes to make a profit. So what's a little mislabeling? Like many of their business practices, a big mistake, but their most consistent mistake is thinking they can get away with it.
A caller to that same radio program asked the guest why he was picking on Wal-Mart. While the guest correctly focused on examples of Wal-Marts unethical and illegal behavior, in particular their flouting of organic standards, my answer would have been shorter, we're not picking on them, they're picking on us.
JIM GOODMAN is a dairy farmer from Wonewoc Wisconsin
LARGEST WORKPLACE RAID EVER
By Mike McPhee
Denver Post
December 13, 2006
A total of 1,282 workers were arrested Tuesday at six Swift & Co. meat packing plants, including 261 workers at the plant in Greeley, federal officials said during a press conference this morning.
Homeland Security Chief Michael Chertoff said 65 workers have been charged criminally. The other 1,217 workers are being held on administrative charges of immigration violations. The arrested workers are from Mexico, Guatemala, Honduras, El Salvador, Peru, Laos, Sudan, Ethiopia and other countries.
"This is the single largest workforce enforcement operation to date," said Julie Myers, assistant secretary of Immigration and Custom Enforcement, in describing what agents called "Operation Wagon Train."
Chertoff added: "I will pretty much guarantee you we're going to continue bringing in these cases."
Of the Colorado workers, 11 of them will be or have been charged criminally and will be prosecuted. The fate of the other 250 Greeley workers being held on immigration violations is unclear, whether they will be released, deported or charged criminally.
More than 1,000 federal agents conducted the raids Tuesday at Swift & Co. meat processing plants in Colorado, Nebraska, Utah, Texas, Iowa and Minnesota.
At least 250 workers were detained at Swift's Grand Island, Nebraska, plant, which employs 600 people. Swift, which claims to be the second-largest meat processing company in the world, said it employs 10,000 people, including 2,700 in Greeley.
Swift had been told that immigration agents were going to raid the packing plants on December 4. Swift's lawyers went to court to stop the raid, arguing it would cause "substantial and irreparable injury" to the company. A federal judge denied the request last Thursday.
Between October 19 and November 17, Swift voluntarily interviewed 450 suspected employees at several of its plants and found that between 90% to 95% were not who they said they were, according to court documents. Four hundred were fired or quit and the company stopped that self-review at ICE s insistence, court documents said.
Chertoff said Swift has cooperated with the government's Basic Pilot program that tracks Social Security numbers around the country. He explained that the program is limited because it can only match names with Social Security numbers.
The program does not spot multiple uses of the same Social Security number.
"If we could get permission from Congress to have the Social Security Administration identify multiple appearances of the same identification, it would help us do our job," Chertoff said.
Myers said a raid in Minnesota earlier this year exposed a ring of identity thieves who were selling actual birth certificates of Puerto Rican citizens.
The Associated Press contributed to this report.
IMMIGRATION RAIDS MAY AFFECT MEAT PRICES
By Associated Press
December 15, 2006
WICHITA, Kansas --- When hordes of police and immigration officials stormed meatpacking plants in six states this week, the illegal workers arrested may not have been the only victims.
Consumers and the industry itself may be feeling the repercussions in a shortage of meatpackers, higher wage costs and, ultimately, higher prices for the beef that lands on America's tables at home and in restaurants.
Some analysts see the current emphasis on enforcement in the meatpacking industry as the precursor to getting an immigration bill through Congress --- by demonstrating the government's capability to enforce laws at the work site.
"The meatpacking industry has become dependent on an unauthorized labor force, and it is not good government to destroy an entire industry. In some way, there is going to be a meeting of the minds," said Mark Reed, a former immigration regional director who now runs his own consulting business, Border Management Strategies, in Tucson, Arizona.
Every labor-intensive industry --- the hotel industry, the construction industry, agriculture --- will be similarly impacted, he said.
"It just happens the meatpacking industry is in the cross hairs right now," Reed said.
Continued massive immigration raids would cut cattle prices paid to cattle feeders and cattle producers while raising the cost of beef for consumers, said James Mintert, an agricultural economist at Kansas State University.
It would also reduce the available labor supply --- putting the U.S. meatpacking industry in a position more comparable to the Canadian slaughterhouses, which have much higher labor costs because they have less access to cheap immigrant labor.
"You are going to end up paying higher wages," Mintert said.
Swift & Co. said its meatpacking plants were running at reduced levels a day after nearly 1,300 employees were arrested in a massive immigration sweep that temporarily halted operations.
Cattle slaughter numbers had been running about the same as a year ago the day prior to arrests. The immigration sweep on Tuesday cut the nation's daily cattle slaughter numbers by 9 percent, Mintert said.
Still, Mintert cited preliminary data from the Agriculture Department's federally inspected slaughter numbers showing that by Wednesday slaughter numbers nationwide had recovered and were up a fraction from a week ago as other meatpackers picked up the slack at Swift's plants.
"It looks like what took place had limited impact -- we had a one-day impact," he said.
Swift said in a written statement that its operations had resumed at reduced levels on Wednesday at the plants in Greeley, Colorado; Grand Island, Nebraska; Cactus, Texas; Hyrum, Utah; Marshalltown, Iowa; and Worthington, Minnesota. Production was expected to be below normal in the short term, but the company did not provide further details and did not return a call for comment.
At Tyson Foods Inc., the world's largest meat processor, the raids did not result in any significant change to the company's livestock buying efforts, and plants were operating normally at expected production levels, said Tyson spokesman Gary Mickelson.
It is uncertain how much impact increased immigration enforcement at the nation's slaughter plants would have on consumer meat prices.
"If the price of meat goes up a little bit, so what? There is nothing as expensive as cheap labor because we pay for this cheap labor in other ways --- higher insurance costs, higher taxes," said Mark Krikorian, executive director of the Center for Immigration Studies.
He cited a study his group did a few years ago looking at what impact the loss of illegal immigrant labor would have on consumer prices for fresh fruits and vegetables, a far more immigrant-intensive business than meatpackers.
Their study found that in summer the retail price of fresh fruit would go up 6 percent for the first couple of years, and then settle to about four percent higher, Krikorian said.
The last time a major shift in the nation's meatpacking industry occurred was in the 1960s and 1970s when the industry shifted away from the urban areas in the Midwest and located to the Great Plains, where they drew more on immigrant labor.
During the 60s and 70s meatpacking wages were relatively higher than at manufacturing plants, running about 14% to 18% above manufacturing wages at that time, Mintert said. By 2002, meatpacking wages were running 25% below manufacturing wages.
Accompanying the wage drop was the decline of unions in the plants. In the late 1970s, about 45% of the meatpacking industry was unionized. By the late 1980s, that had dropped to 21% as more immigrants took jobs in the industry, Mintert said.
Kevin Good, a senior market analyst for Cattle Fax in Denver, said any disruption to the cattle market from the raids will be short term as other plants absorb the excess cattle. He said beef prices so far have been relatively flat.
"It is part of doing business," Good said of the raids.
MEAT PLANT RAIDS MAY SPUR REFORM
By George Raine
San Francisco Chronicle
December 16, 2006
The Tuesday predawn sweep by 1,000 Immigration and Customs Enforcement agents at six rural meatpacking plants, in which authorities detained 1,282 workers suspected of illegal immigration, so far has had only a minor impact on the cattle industry. But it appears to be giving impetus to immigration reform.
In what was called Operation Wagon Train, the agents descended on plants operated by Swift & Co. Federal officials said they had substantial evidence that hundreds of illegal immigrants employed by the company had used stolen Social Security numbers and birth dates of U.S. citizens to gain employment.
The workers face administrative charges and deportation. Sixty-five were charged with criminal offenses, including identify theft and forgery.
The enforcement action prompted speculation that meat supplies might be squeezed because the meatpacking industry depends heavily on immigrant labor. But analysts said only a series of raids and a major depletion of the industry workforce would cause a decline in production and lead to higher prices, as long as demand holds steady. A one-time event has little impact, they said.
The detained workers represent about ten percent of Swift's workforce at the six plants, said Swift spokesman Sean McHugh.
The company said in a statement Wednesday that operations had resumed at all six facilities one day after the raids. Output levels were expected to be below normal for the short term, but Swift said it "anticipates no adverse long-term impacts to its operations.''
Farm advocates and representatives of the Bush administration said the sweeps help make the case for immigration reform, specifically the need for a guest-worker program that would allow foreigners to work legally in the United States. California agriculture, like the meatpacking industry, is heavily dependent on foreign workers.
Secretary of Homeland Security Michael Chertoff, announcing the results of the raids on Wednesday, put it in the context of the need for "stronger border security, effective interior enforcement and a temporary-worker program.''
"That would be a program that would allow businesses that need foreign workers, because they can't otherwise satisfy their labor needs, to be able to get those workers in a regulated program that gives us visibility into who is coming in, has a secure form of identification and makes sure that the federal government is able to collect and promptly allocate all the necessary taxes,'' Chertoff said.
Food industry representatives said such a program is essential.
"It's needed all along the food chain,'' said James Geller, owner of Geller International, a food exporter in Burlingame. "I understand we need to regulate people coming into this country, but we are going to regulate ourselves out of food if we do not resolve the labor problem. Eventually, without reform, we will have so few people (harvesting crops) that the consumer will have to pay more."
Organized labor lambasted the raids. "All of us, native born and immigrant alike, are victims of a failed immigration system,'' said John Wilhelm, president of Unite Here, a union representing approximately 450,000 North American workers in the hotel, food service and other industries. "Worksite raids with armed agents are not the answer to the nationwide call for immigration reform.''
PRESSURE MAY BUILD TO PLANT RESERVED CROPLAND
By Philip Brasher
Des Moines Register
November 19, 2006
If Iowa continues to increase its production of ethanol, and its demand for grain, farmers are likely to look for more land on which to grow corn. One obvious place to find that is among the nearly two million acres of former cropland now retired through the federal Conservation Reserve Program.
Under the CRP, landowners who agree to take environmentally sensitive acreage out of production for ten to 15 years are guaranteed an annual payment in line with its rental value. The land must be planted to grass and trees. The vegetation provides valuable habitat for wildlife while protecting streams and ponds from the pollutants that run off nearby cropland.
So far, landowners aren't rushing to pull land out of the CRP. Many of them had a chance to do so this year during the re-enrollment period for CRP contracts, covering nearly 500,000 acres, that are due to expire in 2007. All but about 93,000 acres will be re-enrolled.
"People are utilizing it and enjoying it and want it," Dave Van Waus, a wildlife biologist for the conservation group Pheasants Forever, said of the reserved land.
But that's not to say that landowners won't think differently if corn prices continue to rise. The U.S. Department of Agriculture is projecting that the price of the corn harvested this fall will average $2.80 to $3.20 a bushel, compared with $2 a bushel for last year's crop.
Grain processors, livestock producers and some in the ethanol industry will be pressuring Congress as it writes the next farm bill to shrink the land-retirement program, which now includes 36 million acres nationwide. It only makes sense, these businesses believe, since the CRP was created in the 1980s when price-depressing crop surpluses, not shortages, were the worry of the day.
Joy Philippi, National Pork Producers Council president, warned a House committee recently that hog farmers would be squeezed by feed prices unless some of the CRP acreage was planted to corn.
How much Iowa land will come out of the program isn't clear. The USDA estimates that 4.3 million to 7.2 million acres in the Midwest could be put into corn and soybean production without damaging the environment. The estimate is based on the amount of CRP acreage in areas with historically heavy corn production already.
Much of Iowa's CRP acreage is in southern and eastern areas of the state where the land is hilly and prone to erosion and not well-suited for farming. More than ten percent of the state's CRP acreage is in four counties --- Taylor, Ringgold, Decatur and Wayne - along the Missouri border.
"It's not for the most part prime farm ground," said Alan Schmidt, a USDA official in Washington County, which has 46,641 acres in the program.
Still, Craig Lang, president of the Iowa Farm Bureau, estimates that 500,000 acres of CRP land in the state, one-quarter of the total, is likely to be pulled out of the program.
Todd Bogenschutz, an upland game biologist who follows CRP policy for the Iowa Department of Natural Resources, sees the state losing as much as 300,000 acres in the next few years, including the 93,000 acres that won't be renewed in 2007.
Some of the state's CRP land is almost untouchable for environmental reasons. Strips of land along streams, for example, are critical to preventing excess fertilizer from getting into the water and can be enrolled in the program at any time. Iowa has 460,645 acres enrolled under that criterion, more than any other state. Even if landowners keep the most erodible land in the program, there is still a downside to reducing the acreage: Wildlife habitat would be lost.
The number of pheasants in Iowa skyrocketed after the first land was enrolled in the CRP in 1986. Hunters killed 1.4 million of the birds in 1987, compared with 900,000 in the years before the program. The numbers dipped a decade later when Congress tightened the program's rules and Iowa's CRP acreage shrank.
"For every acre we lose, we're going to lose wildlife populations, simply put," said Van Waus.
WHAT ABOUT THE LAND ???
By Julia Olmstead
Grist
December 5, 2006
Great news! We can finally scratch "driving less" off our list of ways to curb global warming and reduce our dependence on foreign oil! Biofuels will soon not only replace much of our petroleum, but improve soil fertility and save the American farmer as well! Sound too good to be true? Well, yes. But you could be excused for buying the hype.
Ethanol and biodiesel are being promoted as cures for our energy and environmental woes not just by flacks for corporations like Archer Daniels Midland, BP, and DuPont, but by many eco-minded activists and some prominent environmental groups like the Natural Resources Defense Council as well.
As intuitive as it may seem that fuel from plants would be more benign than petroleum-based fuels, the ecological impacts of biofuel production are more complicated, and wider-reaching, than an environmentalist might first imagine.
For years, some critics have claimed that corn-based ethanol has a negative "net energy balance" --- that is, that ethanol requires more energy to produce than it delivers as fuel. But as biofuel production efficiencies have improved, critics have turned their focus to broader sustainability issues.
"Even if corn and soy biodiesel have positive energy balances, that's not enough," says Andy Heggenstaller, a graduate student at Iowa State University researching biofuel crop production. "Large-scale production of corn and soybeans has negative ecological consequences. If biofuels are based on systems that exacerbate soil erosion and water contamination, they're ultimately not sustainable."
Corn is one of the planet's most energy-intensive crops. Industrial corn production requires huge quantities of synthetic nitrogen fertilizers (derived primarily from natural gas) and petroleum-based pesticides like atrazine, a known endocrine disrupter. Soybeans need less nitrogen, but farmers douse bean fields with other nutrients and with chemicals like Roundup to keep them pest-free.
The effects of corn and soybean production in the Midwest include massive topsoil erosion, pollution of surface and groundwater with pesticides, and fertilizer runoff that travels down the Mississippi River to deplete oxygen from a portion of the Gulf of Mexico called the dead zone that has, in the last few years, been the size of New Jersey.
As ethanol use pushes corn prices higher, farmers are increasingly abandoning the traditional corn-soybean rotation to what's known in farm country as corn-on-corn. High prices have encouraged farmers to plant corn year after year, an intensification that boosts fertilizer and pesticide requirements.
Water use has also become a concern as corn production expands into drier areas like Kansas, where the crop requires irrigation. The ethanol boom has sent water demands skyrocketing, putting pressure on already suffering sources like the Ogallala aquifer.
And according to a recent report by the World Resources Institute, stepped-up corn ethanol production means not only increases in soil erosion and water pollution, but increases in greenhouse-gas emissions. "If your objective is reducing greenhouse-gas emissions, you need to be aware of what's happening in the agricultural sector," says Liz Marshall, coauthor of the WRI study.
Ethanol proponents say the fuel emits up to 13% fewer greenhouse gases than gasoline. But an increase in emissions on the farm could cancel out benefits from emission decreases at the tailpipe.
These environmental concerns have led researchers like Heggenstaller to join a wave of interest in a new generation of biofuels, the much-hyped but yet-to-be-seen-on-the-market cellulosic ethanol. Cellulosic differs from grain ethanol in that the fuel comes from the fiber in the plant, rather than the starches in the grain. Any type of plant material can be a source of cellulose, and even cow manure could be processed into fuel.
Fans of cellulosic ethanol are interested in perennial grasses like prairie native switchgrass and towering miscanthus, which require much lower quantities of fertilizers and pesticides than corn and eliminate the need to plow fields annually, a major cause of soil erosion. They say these crops could produce much greater quantities of biomass than corn, and on lands less suitable for crop production.
Indeed, if biofuels are going to make a substantial dent in meeting our fuel needs, processors will need to look beyond corn. If all the corn currently grown in the U.S. were turned into ethanol, it would replace only 15 percent of our annual gasoline demand. (By way of comparison, we could eliminate 15 percent of our gasoline demand by increasing average fuel efficiency of U.S. cars by just four miles per gallon --- an attainable goal using on-the-shelf technology.)
Due to soybeans' relatively low oil yield, soy biodiesel production in the U.S. has already been written off as marginal by most researchers. So many academic and industry leaders are intensely optimistic about the transition to cellulosic sources.
"There's no doubt cellulosic ethanol can supply our energy needs," says Emily Heaton, manager of Energy Crop Product Development at Ceres, Inc., a California-based plant biotechnology company that's working to develop high-yield biomass crops. She agrees with projections from the U.S. Department of Energy that say fuel from perennial grasses could replace more than a third of our petroleum needs by 2030. "We'll be producing more than a billion tons of biomass a year in an environmentally sustainable way," Heaton says.
But even the advent of cellulosic ethanol --- which is not expected to come on line for at least several more years --- could mean more corn, according to Charles Brummer, a professor of plant breeding at the University of Georgia who works with switchgrass and other perennial biomass plants. Corn stalks and other residues from the corn harvest could be used to make cellulosic ethanol just as readily as switchgrass.
"Farmers will produce what makes money," Brummer says. "As long as farm programs support corn production, we're not going to see them growing much of anything else."
The hype over biofuels in the U.S. and Europe has had wide-ranging effects perhaps not envisioned by the environmental advocates who promote their use. Throughout tropical countries like Indonesia, Malaysia, Brazil, and Colombia, rainforests and grasslands are being cleared for soybean and oil-palm plantations to make biodiesel, a product that is then marketed halfway across the world as a "green" fuel.
In Southeast Asia, and increasingly in the Amazon, plantations of the African oil palm have become wildly lucrative. After monocropping the palms on recently cleared rainforest land, growers press the palm fruit and kernel for oil that can be used in both food and industrial applications, including --- and increasingly --- as biodiesel.
The palm oil industry is booming: global exports increased more than 50 percent from 1999 to 2004. To meet the growing demand, producers in Malaysia and Indonesia have ramped up production by clearing thousands of square miles of rainforest for new plantations.
In Indonesia, rainforest loss for oil palms has contributed to the endangerment of 140 species of land animals, while in Malaysia animals like the Sumatran tiger and Bornean orangutan have been pushed to the brink of extinction. Fish kills have become common in waterways surrounding plantations and palm-oil mills, as soil erosion from the cleared land and mill effluents have left waterways clogged with sediment and unviable.
The boom hasn't been limited to Southeast Asia. In one of the most disturbing examples of the biofuel hype's hidden effects, right-wing paramilitary groups in Colombia --- a country mired in a four-decade-old civil war -- have in recent years begun planting oil palm plantations over wide swaths of the territory they control.
These areas of tropical forest, which lie in the northwestern coastal region known as the Chocó and rank among the planet's key storehouses of biodiversity, have been almost entirely expropriated through violence, including massacres of Afro-Colombian and indigenous communities that have forced those populations out of the region.
Farther south, another biodiversity hotspot is being rapidly cleared to plant a biodiesel crop. Nearly 80% of Brazil's Cerrado region --- a woodland savanna mix --- has been cleared for agricultural production, mostly for soybeans, according to a Conservation International report.
Despite being home to thousands of endemic plant and animal species, the Cerrado has been promoted as "the last agricultural frontier" by green-revolution hero and Nobel Peace Prize winner Norman Borlaug. Low land and labor costs and high yield potential have sent investors from as far away as Iowa scrambling to buy up these Brazilian grasslands, frequently in collaboration with U.S. agribusinesses like Archer Daniels Midland, whose first Brazilian biodiesel production facility is currently in the works.
Tad Patzek, a professor in UC-Berkeley's Department of Civil and Environmental Engineering who's known primarily as a critic of corn ethanol, says what's happening in tropical ecosystems is much more serious than the biofuel situation in the U.S.
"We've already destroyed the prairie, and the topsoil in the Midwest is going, going, gone," Patzek says. "But the expensive noise we're making here is being translated there into the total obliteration of the most precious ecosystems on earth."
JULIA OLMSTEAD is a graduate student in plant breeding and sustainable agriculture at Iowa State University and a graduate fellow with the Land Institute in Salina, Kansas, and a freelance writer on agricultural and environmental issues.
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The Agribusiness Examiner Issue #476
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'Monitoring corporate agribusiness from a public interest perspective'
By Al Krebs--Editor
Corporate Agribusiness Research Project, Dec 18, 2006
Straight to the Source
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