September 09, 2011

Corn market under pressure, but scientists can help

By Madeline McCurry-Schmidt

Demand for corn is increasing, and those in animal agriculture face huge costs for the price of feed. In a web chat hosted by the American Society of Animal Science on Sept. 7, animal nutrition consultant Jerry C. Weigel explained how bad weather and new industries are affecting the corn crop in the U.S.

“I’m sorry to have to say this, ladies and gentlemen, but the verdict is: corn is bullish,” Weigel said. “The market will continue to be extremely volatile, and in my opinion, it will depend on the weather and what the economic market is.”

An important step in predicting how corn prices will affect animal operations is to understand the pressures in the current market.

According to Weigel, two big reasons for higher costs are growing demands from international markets and the ethanol industry. Japan recently increased demand for corn and become the biggest market for U.S. corn exports. Weigel predicted that demand will also increase from India. For animal producers in the U.S., this competition from over-seas has led to higher costs for corn-based animal feed.

Another major pressure on the corn market is the demand for ethanol. The U.S. recently surpassed Brazil as the number one source for ethanol. This means more corn that could be used as animal feed is being used as fuel.

Weigel said that, historically, farmers have responded to increased demand for corn by increasing production. Unfortunately, there is now very little land for farmers to expand into.

“I simply do not think we can increase our corn availability by planting more acres,” Weigel said.

This is where Weigel thinks plant and animal scientists can step in. He said plant scientists need to figure out ways to improve corn traits like drought tolerance and nitrogen-use efficiency. Animal scientists should study how to improve feed efficiency and growth.

Meanwhile, producers need to think about feeding their animals products like sorghum.

“We have to look at every possible alternative out there,” said Weigel.

Click here to listen to the web chat recording and learn about future web chats.