February 6, 2017
The Queensland Renewable Fuels Association (QRFA) has downplayed a recent article in Beef Central which suggested Queensland’s ethanol mandate could leave beef feeders exposed during times of grain shortages.
In an interview with Beef Central, Australian Lot Feeders Association president Tess Herbert expressed fears that Queensland’s 3 per cent ethanol mandate could remove a “considerable portion” of the State’s grain crop and leave lot feeders paying artificially high prices.
The QRFA said there was some justification for Ms Herbert’s argument, but the benefits of ethanol for rural communities outweighed the costs.
“It’s true ethanol production increases grain prices slightly, which affects those who raise their livestock on it,” a QRFA spokesperson said.
“However, this is by design. Not only does ethanol production provide a cleaner home-grown fuel, but the increased grain demand supports a stronger rural economy.”
The QFRA said grain prices were already rising due to increased consumption from in China, India and the Middle East, which had prompted farmers worldwide to expand their grain crop acreage to meet growing demand.
“This is a great boost for Australian agriculture, which deserves celebration,” the QRFA said.
“However, ethanol production creates jobs in rural areas.
“Studies have shown that 80 per cent of revenues generated from ethanol plants is spent within a 100-kilometre radius of the plant.
“This is a huge improvement on petroleum based fuels like diesel and petrol, which are largely drilled and refined overseas with the profits lining the pockets of foreign corporations, not local Australians.”
The QRFA said ethanol production not only creates jobs, but ethanol workers spend their wages in their local communities, which helps local business survive.
Another benefit of ethanol production is that it produces a co-product called “distillers grain”, a high protein, high fat, high fibre cattle feed supplement left over after the starch is removed for ethanol.
“Previously this was mainly found as a by-product in alcohol distilleries, hence the name,” the QRFA said.
“Distiller’s grain is one of the primary feed supplements for cattle worldwide. So ethanol production can actually reduce costs in some ways.”
Historically there has never been a perfect equilibrium when it comes to agriculture – high grain prices annoy lot feeders, and cheap grain prices annoy grain producers.
“Perhaps a better way to look at this is to apply the old adage “a rising tide carries all ships.” A strong rural economy is good for everyone, cattle feeders and grain farmers alike,” the QRFA said.
“The difference between the Government requiring use of ethanol is straightforward. The use of ethanol and other renewable fuels benefits not only agriculture but the entire country, rural and suburban alike.
“It is in our national interest to develop a strong domestic energy source that is not only environmentally friendly, but creates jobs, economic growth and greater energy security.
“After all, we can grow and manufacture ethanol largely on our own, compared to fossil fuels from the volatile Middle East.
“It’s common knowledge that if there was no requirement to use renewable fuels the oil industry would never do so voluntarily. Mandating ethanol use will create a stronger, cleaner, more sustainable economy that serves everyone. This is a logical and necessary step for governments to pave the way for future sustainability initiatives.”
The QRFA said it was unfortunate some segments of agriculture view ethanol in a negative light, because it believes the benefits outweigh any possible small increase in grain prices.
“All segments of agriculture should support a robust ethanol industry, because by doing so you support a strong rural economy, and that helps everyone,” the QRFA said.
- External link: Queensland Ethanol Mandate Leaves Lotfeeders Exposed During Times Of Grain Shortage (Beef Central)
