Co-products and Iowa's Cattle Industry

Christa Hartsook, Communications Specialist, Value Added Agriculture Program

Iowa is the leader in renewable fuels production. Currently, Iowa has 25 ethanol refineries with the capacity to produce over 1.5 billion gallons annually. There are 4 ethanol refineries and two major expansions under construction with a combined annual capacity of 425 million gallons. Many additional renewable fuels projects are under development.
The rapid expansion and production of the ethanol industry in Iowa has provided producers with an additional market for corn a product abundantly produced in the state. This new market for corn and increased demand for renewable fuel across the nation has also increased the production of co-products from the ethanol process.
Feeding cattle is the original value-added agriculture investment in Iowa. Corn, produced abundantly in the state, offers producers easy access to low-cost inputs when corn prices are low. The explosion of ethanol plants in the state also provides feedlots with an additional feedstuff in co-products. With the availability of quality feedstuffs and the Iowa mentality to embrace agriculture as the backbone of this state, the cattle industry is being viewed as a potential economic developer for Iowa.
The Value Added Agriculture Program and the Iowa Beef Center teamed up to co-sponsor a conference: Iowas Cattle Industry: Ethanol, Opportunities and Economic Development. This conference was planned to assist lenders, economic development leaders, and producers in exploring ways to work together to expand Iowas cattle feeding industry. 
The conference focused not only on the initial goal of expanding the cattle industry, but the potential growth for Iowas economy as a whole. Cattle are produced in every county in Iowa.  Expanding this industry will no doubt create economic activity, jobs, and tax revenue, and enhance the economy of rural communities and the entire state.
The agenda included a welcome and overview from Dr. Jack Payne, vice provost for ISU Extension and Craig Hill from the Iowa Farm Bureau Federation.  The program consisted of panels addressing the different facets of the cattle production business.  The topics include:
        The cattle industry and renewable energy economics
        Overview of feedlot facilities, including design, costs, regulations, and community buy-in
        Business and financial considerations
        Management needs, with guest speakers from Iowas premier feedlots
Additionally, web streaming of the presentations of selected speakers was made available online for others interested in expanding the cattle industry in response to the ethanol industrys increased presence.
More than 200 producers, economic development officials, lenders and ethanol industry representatives attended the June 5, 2006 event. Evaluations from the event were collected, analyzed and compiled. All were overwhelming positive for the event, and several mentioned that the information on June 5 encouraged and strengthened their decision to expand. Several producer alliance groups and ethanol facilities have since contacted the Value Added Agriculture Program to discuss the feasibility of establishing a larger investment feedlot co-located to an ethanol facility, or in close proximity to several ethanol facilities.
Relationships were strengthened by a successful event with the following co-sponsors of the conference: the Iowa Area Development Group, Iowa Cattlemens Association, Iowa Corn Growers Association, Iowa Farm Bureau Federation, Iowa Renewable Fuels Association and Professional Developers of Iowa.
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August 2006
POW #121 - Adding Value and Enhancing Agricultural Products

Page last updated: August 29, 2006
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