One-Sided Article Blames Ethanol for Meat Price Hike

Cindy Zimmerman

The ethanol industry was quick to respond to a Bloomberg Business Week article Monday that places the blame for the current hike in meat prices solely on using corn for ethanol.

The story quotes several meat industry representatives who state that current higher meat prices are “ethanol-induced” – the result of hog and cattle herds that were reduced in 2008 due because demand for more ethanol drove up the cost of feed.

Growth EnergyJumping to the defense of corn ethanol, Growth Energy CEO Tom Buis said the story “accepts as fact a disproven myth that ethanol somehow drives up food prices — the goal of a carefully coordinated propaganda campaign that is not based on truth.”

In fact, the Congressional Budget Office report released in April 2009 and a recent report from the UK found that it was mainly higher oil prices that drove prices for both food and feed higher in 2008. That was proven true last year when the amount of corn used for ethanol increased from 2008, but feed and food prices went down.

The completely one-sided article belatedly added a short paragraph with a response from the ethanol industry. Ethanol producers say their industry is unfairly blamed for the record feed costs of 2008. The surge reflected “wild speculation in the markets and the surge of index funds” rather than the jump in corn use for fuel, said Chris Thorne, a spokesman for Growth Energy, a Washington-based ethanol trade group. “Grain producers in this country will more than meet all expected demand for export, for food, for livestock feed and certainly for fuel.” That was added as an update in paragraph 22 some time after the original story was released on line.

Ethanol, Food prices, Growth Energy