:: Biofuels and Farming

The long predicted rise in grain prices has finally arrived with some prices close to doubling, partly because of poor growing seasons in Australia and Brazil, but also thanks to the development of a major new grain consumer, the biofuel industry. Several new biofuel plants are under construction and more are being proposed across the entire North American continent.

Even with a return to more normal conditions in southern grain-growing regions, biofuel will keep demand for grain at record levels. The demand for grain, especially corn and wheat, will continue whether or not it makes economic sense, because the U.S. considers domestically produced fuel a matter of national security. Even if Canada doesn't match American enthusiasm for biofuels, its farmers will benefit from the removal of vast amounts of feed grains from North American markets.

The oilseeds outlook is bright, too. Biodiesel is generally considered a better biofuel, in economic and environmental terms, than ethanol. Demand for specialty canola’s for healthy oil and industrial uses is growing.

Livestock producers who feed large quantities of grains have been watching the shift in grain prices with mixed feelings. Their reliance on high energy, grain-based diets developed because grain prices were so low. It may continue to pencil out. Supplies of oilseed meal may increase with greater use in the region. New technology developed in western Canada can identify feed grains that support feed efficiency over a third better than those chosen traditionally. More extensive livestock options may be more attractive. Grazing technology to extend the prairie grazing season, including winter watering systems and winter swath grazing, have developed rapidly in the last few years. Many advances have come from farmers who are willing, even eager, to share the techniques they've developed through trial and error.

Consumers, increasingly concerned about their health and about what they perceive as animal well-being, are open to meat products from grass-fed livestock. Stockmen as well as consumers gain great satisfaction from their contribution to maintaining a healthy environment, particularly water, that they all share. Appreciation for the exquisite environment and its workings shows in discussions at almost every farm meeting.

The current Canadian government has indicated its readiness to open grain marketing, with open barley marketing to start fall 2007 but defends supply management – quotas and set prices (cost of production formula's) for Dairy and Poultry.