The Future of Farming:
The Future of Farming: Promise and Opportunity…..
Rick Tolman Chief Executive Officer National Corn Growers Association
Greenhouse Gas Emissions
Deforestation….
Dead Zone, Hypoxia
Soil Erosion, Overuse of Chemicals, Air Pollution……
Hunger….
Obesity…..
And….. •Animal Welfare •Environmental Regulation •Taxes •“Industrial Farms” •Subsidies •Sustainability •And on and on…..
“Farming looks mighty easy when your plow is a pencil and you're a thousand miles from the corn field.” Dwight D. Eisenhower
Four Things…… • NCGA • Good News Story
• Ethanol • What We Can Do
National Corn Growers Association NCGA is an association and a federation composed of:
25 State Associations 23 Checkoff Boards •Arkansas, Alabama and Mississippi added • Indiana, Missouri, Iowa and Illinois, recent checkoff increases
State Organizations and Grower Members Grower Members
300,000+ Checkoff Investors 35,000+ Members • 22% increase over last 15 years
NCGA’s Mission To Create and Increase Opportunities for Corn Growers •Public Policy •Biotechnology •Production •Stewardship •Biofuels •Trade
NCGA - What Sets Us Apart? • Corn Focused • Grassroots Organization • Covers the Entire Spectrum of Corn Issues Every Day • Checkoff Funds are Highly Leveraged and Efficiently Used
NCGA Grows Checkoff Investments into Valuable Outputs Outputs (Opportunities for Corn) Creating New Markets Voice for Corn Growers Educational Programs Developing Future Leaders Sowing Seeds for Your Future NCGA Staff (Industry Expertise) D.C. and St. Louis Facilities Grower Leader Governance Inputs Checkoff Revenues Grower Volunteer Time Other Resources
Membership Trend 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
U.S. Corn Supply & Area
* Projected; Source: USDA, ERS; ProExporter Network
U.S. Corn Markets 2009-10 crop projection, 14.7 B Bu Total Supply
30 MMT Distiller Grains
Source: USDA
World Corn Production - 2008 Country
Percent
US
39
China
21
EU-27
8
Brazil
7
Mexico
3
India
2
Argentina
2
Others
18
39%
World Corn Exporters - 2008 Country
Million Bushels
US
1,772
Brazil
394
Argentina
354
Ukraine
138
South Africa
98
58%
Key US Corn Export Markets Million Bushels
2006
2007
2008
Japan
628
595
574
Mexico
249
345
387
South Korea
220
159
338
Taiwan
183
170
151
Egypt
159
133
123
Colombia
106
128
116
Canada
74
81
124
U.S. Corn Demand: Export
*
* Projected; Source: USDA, ERS; ProExporter Network
Feed Usage – Corn Only
Source: ProExporter Network
Feed Usage + DDGS
Source: ProExporter Network
Corn Usage (- ethanol)
Source: ProExporter Network
Corn Usage
Source: ProExporter Network
U.S. Corn Yield Bushels Per Acre 151.1
160 140 120 100
Growers are greatly increasing production without needing to boost acres 80.1
119.8
126.7
90.8
80 48.3
60 40
26.4
28.9
28.6
1927
1937
1947
20 0 1957
1967
1977
1987
1997
2007 Source: USDA
More Corn Per Acre
Source: Monsanto
Corn yield (bu/ac)
Anticipated impact of improvements in agronomics, breeding and biotechnology on average corn yields in the United States
Source: Edgerton (2008) Increasing crop productivity to meet global needs for feed, food and fuel. Plant Physiology 149:1-7
U.S. Biotech Corn Acreage, 2000-2009
Source: USDA, NASS
Industry Corn Portfolio*
Agronomic Trait
A Steady Pipeline of Events
Quality Trait
Improved Feed (Pioneer/DuPont) VT Triple Pro (Monsanto)
Drought Tolerance (Monsanto/ BASF)
Broad Lep - MIR 162 (Syngenta)
2009 Corn Amylase (Syngenta)
Drought Tolerance (Syngenta)
Higher Yield (Monsanto/ BASF)
“SmartStax (Monsanto/Dow)
Nitrogen utilization (Pioneer/DuPont)
RW dual Mode of action (Syngenta)
2010
“Optimum” Herb. Tol. (Pioneer/ DuPont)
Nitrogen utilization (Monsanto/BASF)
Improved Feed (BASF)
201X Herbicide Tol. (Dow) Increased Yield (Pioneer/ DuPont)
.
Increased Ethanol (Syngenta)
Triple-mode Herb. Tol. (Pioneer/ DuPont)
Novel Insect Traits (Syngenta)
Increased Ethanol (Pioneer/DuPont)
Drought tolerance (Pioneer/ DuPont)
[*Estimated commercialization pipeline of corn biotech events prepared by the U.S. Grains Council/NCGA Commercialization dependent on many factors, including successful conclusion of regulatory process]
Nitrogen utilization (Syngenta)
CYC Yield and NASS Reported Yield U.S. Average Corn Contest Yield vs. U.S. NASS Average Yield Differential
Corn Yield Contest Average Yield
NASS State Average Yield
1996 CYC Yield
250
Yield (bu/harvested acre)
200
150
100
50
0 1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Corn Yields – Technology & Demand 260 240 220 200 180 160 140 120 100
Aggressive
NCGA Strat Plan
Weak
Source: NCGA
NCGA Strategic Plan
Corn Supply Potential (83 M acres harvested) 23 21 Billion Bushels
19 17 15 13 11 9 7 5
Aggressive
NCGA Strat Plan
Source: NCGA
Field to Market Field to Market: The Keystone Alliance for Sustainable Agriculture is a collaborative stakeholder group involving producers, agribusinesses, food and retail companies, and conservation organizations striving to develop a supply chain system for agricultural sustainability. The primary objectives of Field to Market are: • •
To identify criteria for sustainable agriculture that are open to the full range of agricultural technology choices; To support the implementation of production systems that lead to broad performance improvements against these criteria.
Field to Market Participants • • • • • • • • • • • • • • • •
American Farm Bureau Federation American Soybean Association Bayer CropScience Bunge Limited Cargill ConAgra Conservation International Cotton Incorporated Deere and Company DuPont Fleishman-Hilliard General Mills Inc. Grocery Manufacturers of America Manomet Mars, Inc. McDonald’s
• Monsanto • National Association of Conservation Districts • National Association of Wheat Growers • National Corn Growers Association • National Cotton Council of America • National Potato Council • Syngenta • The Coca-Cola Company • The Kellogg Company • The Nature Conservancy • United Soybean Board • World Wildlife Fund • University of Arkansas • University of Wisconsin
Field to Market Report • Released 1/12/2009 • Looked at environmental resource indicators in five areas: ▫ ▫ ▫ ▫ ▫
water use and quality land use and biodiversity soil loss energy use climate impact
Corn’s Impacts, 1987-2007 Land Use
Soil Loss
Irrigation
Energy
Climate
Amount of land to produce one bushel of corn
Soil loss per bushel, above a tolerable level
Irrigation water use per bushel
Energy used to produce one bushel
Emissions per bushel
37% 69% 27% 37% 30%
Pesticide Use Trends Increasing adoption of hybrids with insectresistant and herbicide-tolerant traits have greatly reduced the need for synthetic applications of herbicides and insecticides. Insecticide Pounds Per Acre
Herbicide Pounds Per Acre
0.35
3.5
0.3
3
0.25
2.5
0.2 0.15 0.1 0.05
19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 05
0
2 1.5 1 0.5 0 1990
1992
1994
1996
1998
2000
2002
2005
Source: USDA
COMMERCIAL NITROGEN APPLIED PER BUSHEL OF CORN PRODUCED Pounds per Bushel 1980 - 2006 ACTUAL & TREND TO 2030 1.80
Actual
1.60
Trend
1.40
1.20
1.00
0.80
0.60
0.40
Corn Growers Become More Efficient With Nitrogen
0.20
0.00 1980 1985 1990 1995 Source: Blue, Johnson & Associates, Inc.
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Assoc. Inc.
APPLIED PHOSPHATE PER BUSHEL OF CORN PRODUCED 1980 - 2006 ACTUAL & TREND TO 2030
Pound per Bushel 0.80
0.70
Actual Trend
0.60
0.50
0.40
0.30
Corn Growers Become More Efficient With Phosphate
0.20
0.10
0.00 1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Associates, Inc.
Source: Blue, Johnson & Assoc. Inc.
Pounds per Bushel
APPLIED POTASH PER BUSHEL OF CORN PRODUCED 1980 - 2006 ACTUAL & TREND TO 2030
1.00
0.90 Actual 0.80
Trend
0.70
0.60
0.50
0.40
0.30
Corn Growers Become More Efficient With Potash
0.20
0.10
0.00 1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Associates, Inc.
Source: Blue, Johnson & Assoc. Inc.
Nutrient Use, 1980-2005 Nitrogen
Phosphate
Potash
% Change in Pounds/Bushel
Total Used
-10.0%
-38.0% -50.6%
-54.7% Source: The Fertilizer Institute
Soil Disruption NO-TILL ACRES AS % OF REPORTING ACRES
% of Reported Acres
35%
31.5%
30% 25.3% 25%
21.6%
21.2%
20% 15% 10%
7.4%
5% 0% 1990
1992
1994
1996
1998
2000
2002
2004
2006
NOTE: DOES NOT INCLUDE OTHER CONSERVATION TILLAGE PRACTICES SUCH AS LOW-TILL, RIDGE-TILL, ETC.
Source: CTIC
2006 Tillage Survey
1990
1992
1994
Conventional-till
1998 Reduced-till
2000
2002
54.7%
50.8%
47.5%
2004
21.8% 23.5%
25.5%
23.7%
24.6% 27.9%
22.9% 27.0%
28.0%
30.0% 1996
50.2%
45.8% 26.2%
44.7% 25.4%
43.7% 31.7%
24.6%
27.6% 28.7%
37.8%
28.4% 33.8%
Percent of Cropland
43.7%
Percent Residue Cover Management Conventional 0-15% Reduced 15-30% Conservation +30%
2006
Conservation-till
Source: CTIC
Cropland Erosion Tons Per Acre
8 7 6 5 4 3 2 1 0
Water
3.3
Wind
3.2 2.6 4.0
1982
2.2
2.1
2.1
3.6
3.1
2.8
2.7
2.6
1987
1992
1997
2001
2003 Source: USDA
Water Usage for Corn Nearly nine out of ten acres of corn require no water other than natural rainfall
13% Irrigated 13% 87% Non-Irrigated
Source: USDA
Corn drought tolerance • Benefits: • Up to 25% yield recovery vs. control under moderate/severe drought • Improved water utilization in water use restricted areas • Launch: 2011, Native traits
normal ear
drought-stressed ear
Precision Farming
Corn Farms by Type
95% of all corn farms are family farms
Good News! • • • • • •
Productivity Technology Land Use Efficiency Food Availability Poverty Sustainability
Ethanol Industry Overview January 1999
January 2000
January 2001
January 2002
January 2003
January 2004
January 2005
January 2006
January 2007
January 2008
January 2009
50
54
56
61
68
72
81
95
110
139
170*
Ethanol Production Capacity
1701.7
1748.7
1921.9
2347.3
2706.8
3100.8
3643.7
4336.4
5493.4
7888.4
10,569.4 **
Plants Under Const/exp
5
6
5
13
11
15
16
31
76
61
24
Capacity Under Const/Exp (MGY)
77
91.5
64.7
390.7
483
598
754
1778
5635.5
5536
States with Ethanol Plants
17
17
18
19
20
19
18
20
21
21
Year
Total Ethanol Plants
2066
26
Source: RFA * operating plants ** 12,475.4 mgy capacity including idled capacity
2008 World Ethanol Production Country
Millions of Gallons
USA
9,000
Brazil
6,472
European Union
734
China
502
Canada
238
Other
128
Thailand
90
Colombia
79
India
66
Australia
26
Total
17,335
Current Status --- Blend Wall • Just under 80% of all motor fuel is E10 – E8 ▫ ~11 BGY blended, ~ 137.5 BGY U.S. market ▫ Assume blending infrastructure limited or small refiners, who do not have to comply until after 2010
• Current capacity plus expansion and construction exceeds current 10% blend wall. • Limitations lower the Wall in the near term
85% 65% 95%
65%
90%
45%
75%
50%
95%
90%
85% 80%
73%
69% 50%
85%
100%
90%
55%
90%
75% 90%
85%
90%
60%
85%
75% 75%
90% 45%
65%
40%
80%
70%
65% 70%
10%
65%
75%
75%
65% 80%
95%
Legend Dark Green Med. Green Light Green Bright Green
75-100% 50-74% 10-49% 15 BGY
12,000 10,000 8,000 6,000 4,000 2,000 0
E85 Station Temperature Map
150 + 100 - 149 50 - 99 25 - 49 1-24 No E85
Source: Alternative Fuels & Advanced Vehicles Data Center (AFDC) National Ethanol Vehicle Coalition (NEVC), Renewable Fuels Assn.
Ethanol: A Low Carbon Fuel…. EPA Net GHG from Gasoline and Corn Ethanol (30 year, 0% discount rate) 100.0 90.0 CO2 eq/MJ
80.0 70.0 60.0 50.0 40.0
93.3
30.0 20.0
37.4
10.0 0.0 Gasoline
Corn ethanol w/o Int Land use
…Until ILUC is Added EPA Net GHG from Gasoline and Corn Ethanol (30 year, 0% discount rate) 120.0 97.8
CO2 eq/MJ
100.0 80.0
60.4
60.0 40.0
93.3
20.0
37.4
0.0 Gasoline
Corn ethanol with Int Land Use
Land Use Change
Amazon Deforestation Slowing 14,000
10,000
12,000 10,000
8,000
8,000 6,000 6,000 4,000
4,000
2,000
2,000
Deforestation
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
0 1989
0
Million Gallons Ethanol
12,000
1988
Square Miles Deforested
Brazilian Deforestation and Global Ethanol Production
Ethanol Production
Source: IEA; Butler, Mongabay.com (FAO, NISR)
300.0
1975/1976 1976/1977 1977/1978 1978/1979 1979/1980 1980/1981 1981/1982 1982/1983 1983/1984 1984/1985 1985/1986 1986/1987 1987/1988 1988/1989 1989/1990 1990/1991 1991/1992 1992/1993 1993/1994 1994/1995 1995/1996 1996/1997 1997/1998 1998/1999 1999/2000 2000/2001 2001/2002 2002/2003 2003/2004 2004/2005 2005/2006 2006/2007 2007/2008 2008/2009 2009/2010
Million Acres
Total Crop Acres • Major US crop acres down 2% in 2009; 1.5% below 10 years ago Acres of Ten Major Crops in U.S. and Non-U.S. USDA 1975/76 - 2009/10
250.0
200.0
150.0
100.0
50.0
0.0
Crop Marketing Years
Increasing Yields Provide…. • More production from the same acres ▫ Common sense?
• Over the past 9 years: ▫ Ethanol production has increased > 8.5 BG ; almost tripled ▫ Corn production has increased an average of 2.89 bu for every bu required for incremental ethanol production
• 2009: After new corn demand for ethanol production is met, there is still an additional 187 million bushels of increased production available for livestock feed, export or other domestic uses.
US Cellulosic Projects 23 3 Butte
19 | 26 Boardman
12 Shelley
5
Old Town
13 Upton
4 . Corona
6
20
Park Falls
Scotland
17
21 .
14 Grand Junction
Roma
16 7
Chippewa CO
Wis Rapids
1
..
Langcaster4
15 .
10
Madison
Emmetsburg
York
2 Hugoton
9 .
11
Washington
St. Joe
8
Brawley
Verona
22 Soperton
24 Jennings
25 Highlands Co
18 Vero Beach
73
NCGA Projects
76
Supply Gap DISCOVERIES
DEMAND
SUPPLY GAP
We are here
The Future of Oil……
Source: RFA
NCGA and Activism
The Challenges: Food & Feed
The Challenges: Fuel
Farmers in the Media
NCGA Advertising
International Indirect Land Use Change…..
NCGA Consumer Research • August 2009: Focus groups with consumers in three locations: Denver, Indianapolis, New York City • September 2009: Nationwide survey of 1,000 voting-age consumers • Strong support for farmers seen, as well as a lot of ignorance about farming
The Good News … A national survey conducted in September found that nearly all Americans have a positive image of farmers.
Uses for Corn Supported
Farmers are Trusted
On issues like ag, farm subsidies, corn products and ethanol
NCGA’s Integrated 2010 Plan • Corn Farmers Coalition: DC-based paid media effort to promote positive images about corn and corn farming. • Image Campaign: Work with selected partners to neutralize effectiveness of production agriculture critics. • Grassroots Mobilization: Create a large, active well-informed army of growers to support policy initiatives.
A Three-Pronged Approach Corn Farmers Coalition
Image Campaign
Grassroots Network
Audience
DC Policymakers
National Media
Grassroots
Objective
Educate inside-theBeltway policymakers with the truth about corn
Target industry Create an army of critics with farmer activists who preemptory tactics support our that neutralize their initiatives impact
Breadth
Corn-focused
Elements include broader industry appeal (commodities, agribusiness, ethanol)
Budget
$1 million
$1 million
$980,000
What Can You Do? • Join your ag associations ▫ All commodities, state and national level
• Stay informed as someone heavily invested in production agriculture ▫ Subscribe to NCGA’s Corn Action News
• Speak out when called on to do so ▫ Watch for action alerts, other local opportunities
Stay Informed
• Corn Action News • Weekly Electronic Newsletter • Focus on Taking Action • Subscribe at ncga.com
Every man owes a part of his time and money to the business or industry in which he is engaged. No man has a moral right to withhold his support from an organization that is striving to improve conditions within his sphere. Teddy Roosevelt
Thank You!
Rick Tolman, CEO National Corn Growers Association – December 2009
Rick Tolman Chief Executive Officer National Corn Growers Association
Greenhouse Gas Emissions
Deforestation….
Dead Zone, Hypoxia
Soil Erosion, Overuse of Chemicals, Air Pollution……
Hunger….
Obesity…..
And….. •Animal Welfare •Environmental Regulation •Taxes •“Industrial Farms” •Subsidies •Sustainability •And on and on…..
“Farming looks mighty easy when your plow is a pencil and you're a thousand miles from the corn field.” Dwight D. Eisenhower
Four Things…… • NCGA • Good News Story
• Ethanol • What We Can Do
National Corn Growers Association NCGA is an association and a federation composed of:
25 State Associations 23 Checkoff Boards •Arkansas, Alabama and Mississippi added • Indiana, Missouri, Iowa and Illinois, recent checkoff increases
State Organizations and Grower Members Grower Members
300,000+ Checkoff Investors 35,000+ Members • 22% increase over last 15 years
NCGA’s Mission To Create and Increase Opportunities for Corn Growers •Public Policy •Biotechnology •Production •Stewardship •Biofuels •Trade
NCGA - What Sets Us Apart? • Corn Focused • Grassroots Organization • Covers the Entire Spectrum of Corn Issues Every Day • Checkoff Funds are Highly Leveraged and Efficiently Used
NCGA Grows Checkoff Investments into Valuable Outputs Outputs (Opportunities for Corn) Creating New Markets Voice for Corn Growers Educational Programs Developing Future Leaders Sowing Seeds for Your Future NCGA Staff (Industry Expertise) D.C. and St. Louis Facilities Grower Leader Governance Inputs Checkoff Revenues Grower Volunteer Time Other Resources
Membership Trend 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
U.S. Corn Supply & Area
* Projected; Source: USDA, ERS; ProExporter Network
U.S. Corn Markets 2009-10 crop projection, 14.7 B Bu Total Supply
30 MMT Distiller Grains
Source: USDA
World Corn Production - 2008 Country
Percent
US
39
China
21
EU-27
8
Brazil
7
Mexico
3
India
2
Argentina
2
Others
18
39%
World Corn Exporters - 2008 Country
Million Bushels
US
1,772
Brazil
394
Argentina
354
Ukraine
138
South Africa
98
58%
Key US Corn Export Markets Million Bushels
2006
2007
2008
Japan
628
595
574
Mexico
249
345
387
South Korea
220
159
338
Taiwan
183
170
151
Egypt
159
133
123
Colombia
106
128
116
Canada
74
81
124
U.S. Corn Demand: Export
*
* Projected; Source: USDA, ERS; ProExporter Network
Feed Usage – Corn Only
Source: ProExporter Network
Feed Usage + DDGS
Source: ProExporter Network
Corn Usage (- ethanol)
Source: ProExporter Network
Corn Usage
Source: ProExporter Network
U.S. Corn Yield Bushels Per Acre 151.1
160 140 120 100
Growers are greatly increasing production without needing to boost acres 80.1
119.8
126.7
90.8
80 48.3
60 40
26.4
28.9
28.6
1927
1937
1947
20 0 1957
1967
1977
1987
1997
2007 Source: USDA
More Corn Per Acre
Source: Monsanto
Corn yield (bu/ac)
Anticipated impact of improvements in agronomics, breeding and biotechnology on average corn yields in the United States
Source: Edgerton (2008) Increasing crop productivity to meet global needs for feed, food and fuel. Plant Physiology 149:1-7
U.S. Biotech Corn Acreage, 2000-2009
Source: USDA, NASS
Industry Corn Portfolio*
Agronomic Trait
A Steady Pipeline of Events
Quality Trait
Improved Feed (Pioneer/DuPont) VT Triple Pro (Monsanto)
Drought Tolerance (Monsanto/ BASF)
Broad Lep - MIR 162 (Syngenta)
2009 Corn Amylase (Syngenta)
Drought Tolerance (Syngenta)
Higher Yield (Monsanto/ BASF)
“SmartStax (Monsanto/Dow)
Nitrogen utilization (Pioneer/DuPont)
RW dual Mode of action (Syngenta)
2010
“Optimum” Herb. Tol. (Pioneer/ DuPont)
Nitrogen utilization (Monsanto/BASF)
Improved Feed (BASF)
201X Herbicide Tol. (Dow) Increased Yield (Pioneer/ DuPont)
.
Increased Ethanol (Syngenta)
Triple-mode Herb. Tol. (Pioneer/ DuPont)
Novel Insect Traits (Syngenta)
Increased Ethanol (Pioneer/DuPont)
Drought tolerance (Pioneer/ DuPont)
[*Estimated commercialization pipeline of corn biotech events prepared by the U.S. Grains Council/NCGA Commercialization dependent on many factors, including successful conclusion of regulatory process]
Nitrogen utilization (Syngenta)
CYC Yield and NASS Reported Yield U.S. Average Corn Contest Yield vs. U.S. NASS Average Yield Differential
Corn Yield Contest Average Yield
NASS State Average Yield
1996 CYC Yield
250
Yield (bu/harvested acre)
200
150
100
50
0 1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Corn Yields – Technology & Demand 260 240 220 200 180 160 140 120 100
Aggressive
NCGA Strat Plan
Weak
Source: NCGA
NCGA Strategic Plan
Corn Supply Potential (83 M acres harvested) 23 21 Billion Bushels
19 17 15 13 11 9 7 5
Aggressive
NCGA Strat Plan
Source: NCGA
Field to Market Field to Market: The Keystone Alliance for Sustainable Agriculture is a collaborative stakeholder group involving producers, agribusinesses, food and retail companies, and conservation organizations striving to develop a supply chain system for agricultural sustainability. The primary objectives of Field to Market are: • •
To identify criteria for sustainable agriculture that are open to the full range of agricultural technology choices; To support the implementation of production systems that lead to broad performance improvements against these criteria.
Field to Market Participants • • • • • • • • • • • • • • • •
American Farm Bureau Federation American Soybean Association Bayer CropScience Bunge Limited Cargill ConAgra Conservation International Cotton Incorporated Deere and Company DuPont Fleishman-Hilliard General Mills Inc. Grocery Manufacturers of America Manomet Mars, Inc. McDonald’s
• Monsanto • National Association of Conservation Districts • National Association of Wheat Growers • National Corn Growers Association • National Cotton Council of America • National Potato Council • Syngenta • The Coca-Cola Company • The Kellogg Company • The Nature Conservancy • United Soybean Board • World Wildlife Fund • University of Arkansas • University of Wisconsin
Field to Market Report • Released 1/12/2009 • Looked at environmental resource indicators in five areas: ▫ ▫ ▫ ▫ ▫
water use and quality land use and biodiversity soil loss energy use climate impact
Corn’s Impacts, 1987-2007 Land Use
Soil Loss
Irrigation
Energy
Climate
Amount of land to produce one bushel of corn
Soil loss per bushel, above a tolerable level
Irrigation water use per bushel
Energy used to produce one bushel
Emissions per bushel
37% 69% 27% 37% 30%
Pesticide Use Trends Increasing adoption of hybrids with insectresistant and herbicide-tolerant traits have greatly reduced the need for synthetic applications of herbicides and insecticides. Insecticide Pounds Per Acre
Herbicide Pounds Per Acre
0.35
3.5
0.3
3
0.25
2.5
0.2 0.15 0.1 0.05
19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 05
0
2 1.5 1 0.5 0 1990
1992
1994
1996
1998
2000
2002
2005
Source: USDA
COMMERCIAL NITROGEN APPLIED PER BUSHEL OF CORN PRODUCED Pounds per Bushel 1980 - 2006 ACTUAL & TREND TO 2030 1.80
Actual
1.60
Trend
1.40
1.20
1.00
0.80
0.60
0.40
Corn Growers Become More Efficient With Nitrogen
0.20
0.00 1980 1985 1990 1995 Source: Blue, Johnson & Associates, Inc.
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Assoc. Inc.
APPLIED PHOSPHATE PER BUSHEL OF CORN PRODUCED 1980 - 2006 ACTUAL & TREND TO 2030
Pound per Bushel 0.80
0.70
Actual Trend
0.60
0.50
0.40
0.30
Corn Growers Become More Efficient With Phosphate
0.20
0.10
0.00 1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Associates, Inc.
Source: Blue, Johnson & Assoc. Inc.
Pounds per Bushel
APPLIED POTASH PER BUSHEL OF CORN PRODUCED 1980 - 2006 ACTUAL & TREND TO 2030
1.00
0.90 Actual 0.80
Trend
0.70
0.60
0.50
0.40
0.30
Corn Growers Become More Efficient With Potash
0.20
0.10
0.00 1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Associates, Inc.
Source: Blue, Johnson & Assoc. Inc.
Nutrient Use, 1980-2005 Nitrogen
Phosphate
Potash
% Change in Pounds/Bushel
Total Used
-10.0%
-38.0% -50.6%
-54.7% Source: The Fertilizer Institute
Soil Disruption NO-TILL ACRES AS % OF REPORTING ACRES
% of Reported Acres
35%
31.5%
30% 25.3% 25%
21.6%
21.2%
20% 15% 10%
7.4%
5% 0% 1990
1992
1994
1996
1998
2000
2002
2004
2006
NOTE: DOES NOT INCLUDE OTHER CONSERVATION TILLAGE PRACTICES SUCH AS LOW-TILL, RIDGE-TILL, ETC.
Source: CTIC
2006 Tillage Survey
1990
1992
1994
Conventional-till
1998 Reduced-till
2000
2002
54.7%
50.8%
47.5%
2004
21.8% 23.5%
25.5%
23.7%
24.6% 27.9%
22.9% 27.0%
28.0%
30.0% 1996
50.2%
45.8% 26.2%
44.7% 25.4%
43.7% 31.7%
24.6%
27.6% 28.7%
37.8%
28.4% 33.8%
Percent of Cropland
43.7%
Percent Residue Cover Management Conventional 0-15% Reduced 15-30% Conservation +30%
2006
Conservation-till
Source: CTIC
Cropland Erosion Tons Per Acre
8 7 6 5 4 3 2 1 0
Water
3.3
Wind
3.2 2.6 4.0
1982
2.2
2.1
2.1
3.6
3.1
2.8
2.7
2.6
1987
1992
1997
2001
2003 Source: USDA
Water Usage for Corn Nearly nine out of ten acres of corn require no water other than natural rainfall
13% Irrigated 13% 87% Non-Irrigated
Source: USDA
Corn drought tolerance • Benefits: • Up to 25% yield recovery vs. control under moderate/severe drought • Improved water utilization in water use restricted areas • Launch: 2011, Native traits
normal ear
drought-stressed ear
Precision Farming
Corn Farms by Type
95% of all corn farms are family farms
Good News! • • • • • •
Productivity Technology Land Use Efficiency Food Availability Poverty Sustainability
Ethanol Industry Overview January 1999
January 2000
January 2001
January 2002
January 2003
January 2004
January 2005
January 2006
January 2007
January 2008
January 2009
50
54
56
61
68
72
81
95
110
139
170*
Ethanol Production Capacity
1701.7
1748.7
1921.9
2347.3
2706.8
3100.8
3643.7
4336.4
5493.4
7888.4
10,569.4 **
Plants Under Const/exp
5
6
5
13
11
15
16
31
76
61
24
Capacity Under Const/Exp (MGY)
77
91.5
64.7
390.7
483
598
754
1778
5635.5
5536
States with Ethanol Plants
17
17
18
19
20
19
18
20
21
21
Year
Total Ethanol Plants
2066
26
Source: RFA * operating plants ** 12,475.4 mgy capacity including idled capacity
2008 World Ethanol Production Country
Millions of Gallons
USA
9,000
Brazil
6,472
European Union
734
China
502
Canada
238
Other
128
Thailand
90
Colombia
79
India
66
Australia
26
Total
17,335
Current Status --- Blend Wall • Just under 80% of all motor fuel is E10 – E8 ▫ ~11 BGY blended, ~ 137.5 BGY U.S. market ▫ Assume blending infrastructure limited or small refiners, who do not have to comply until after 2010
• Current capacity plus expansion and construction exceeds current 10% blend wall. • Limitations lower the Wall in the near term
85% 65% 95%
65%
90%
45%
75%
50%
95%
90%
85% 80%
73%
69% 50%
85%
100%
90%
55%
90%
75% 90%
85%
90%
60%
85%
75% 75%
90% 45%
65%
40%
80%
70%
65% 70%
10%
65%
75%
75%
65% 80%
95%
Legend Dark Green Med. Green Light Green Bright Green
75-100% 50-74% 10-49% 15 BGY
12,000 10,000 8,000 6,000 4,000 2,000 0
E85 Station Temperature Map
150 + 100 - 149 50 - 99 25 - 49 1-24 No E85
Source: Alternative Fuels & Advanced Vehicles Data Center (AFDC) National Ethanol Vehicle Coalition (NEVC), Renewable Fuels Assn.
Ethanol: A Low Carbon Fuel…. EPA Net GHG from Gasoline and Corn Ethanol (30 year, 0% discount rate) 100.0 90.0 CO2 eq/MJ
80.0 70.0 60.0 50.0 40.0
93.3
30.0 20.0
37.4
10.0 0.0 Gasoline
Corn ethanol w/o Int Land use
…Until ILUC is Added EPA Net GHG from Gasoline and Corn Ethanol (30 year, 0% discount rate) 120.0 97.8
CO2 eq/MJ
100.0 80.0
60.4
60.0 40.0
93.3
20.0
37.4
0.0 Gasoline
Corn ethanol with Int Land Use
Land Use Change
Amazon Deforestation Slowing 14,000
10,000
12,000 10,000
8,000
8,000 6,000 6,000 4,000
4,000
2,000
2,000
Deforestation
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
0 1989
0
Million Gallons Ethanol
12,000
1988
Square Miles Deforested
Brazilian Deforestation and Global Ethanol Production
Ethanol Production
Source: IEA; Butler, Mongabay.com (FAO, NISR)
300.0
1975/1976 1976/1977 1977/1978 1978/1979 1979/1980 1980/1981 1981/1982 1982/1983 1983/1984 1984/1985 1985/1986 1986/1987 1987/1988 1988/1989 1989/1990 1990/1991 1991/1992 1992/1993 1993/1994 1994/1995 1995/1996 1996/1997 1997/1998 1998/1999 1999/2000 2000/2001 2001/2002 2002/2003 2003/2004 2004/2005 2005/2006 2006/2007 2007/2008 2008/2009 2009/2010
Million Acres
Total Crop Acres • Major US crop acres down 2% in 2009; 1.5% below 10 years ago Acres of Ten Major Crops in U.S. and Non-U.S. USDA 1975/76 - 2009/10
250.0
200.0
150.0
100.0
50.0
0.0
Crop Marketing Years
Increasing Yields Provide…. • More production from the same acres ▫ Common sense?
• Over the past 9 years: ▫ Ethanol production has increased > 8.5 BG ; almost tripled ▫ Corn production has increased an average of 2.89 bu for every bu required for incremental ethanol production
• 2009: After new corn demand for ethanol production is met, there is still an additional 187 million bushels of increased production available for livestock feed, export or other domestic uses.
US Cellulosic Projects 23 3 Butte
19 | 26 Boardman
12 Shelley
5
Old Town
13 Upton
4 . Corona
6
20
Park Falls
Scotland
17
21 .
14 Grand Junction
Roma
16 7
Chippewa CO
Wis Rapids
1
..
Langcaster4
15 .
10
Madison
Emmetsburg
York
2 Hugoton
9 .
11
Washington
St. Joe
8
Brawley
Verona
22 Soperton
24 Jennings
25 Highlands Co
18 Vero Beach
73
NCGA Projects
76
Supply Gap DISCOVERIES
DEMAND
SUPPLY GAP
We are here
The Future of Oil……
Source: RFA
NCGA and Activism
The Challenges: Food & Feed
The Challenges: Fuel
Farmers in the Media
NCGA Advertising
International Indirect Land Use Change…..
NCGA Consumer Research • August 2009: Focus groups with consumers in three locations: Denver, Indianapolis, New York City • September 2009: Nationwide survey of 1,000 voting-age consumers • Strong support for farmers seen, as well as a lot of ignorance about farming
The Good News … A national survey conducted in September found that nearly all Americans have a positive image of farmers.
Uses for Corn Supported
Farmers are Trusted
On issues like ag, farm subsidies, corn products and ethanol
NCGA’s Integrated 2010 Plan • Corn Farmers Coalition: DC-based paid media effort to promote positive images about corn and corn farming. • Image Campaign: Work with selected partners to neutralize effectiveness of production agriculture critics. • Grassroots Mobilization: Create a large, active well-informed army of growers to support policy initiatives.
A Three-Pronged Approach Corn Farmers Coalition
Image Campaign
Grassroots Network
Audience
DC Policymakers
National Media
Grassroots
Objective
Educate inside-theBeltway policymakers with the truth about corn
Target industry Create an army of critics with farmer activists who preemptory tactics support our that neutralize their initiatives impact
Breadth
Corn-focused
Elements include broader industry appeal (commodities, agribusiness, ethanol)
Budget
$1 million
$1 million
$980,000
What Can You Do? • Join your ag associations ▫ All commodities, state and national level
• Stay informed as someone heavily invested in production agriculture ▫ Subscribe to NCGA’s Corn Action News
• Speak out when called on to do so ▫ Watch for action alerts, other local opportunities
Stay Informed
• Corn Action News • Weekly Electronic Newsletter • Focus on Taking Action • Subscribe at ncga.com
Every man owes a part of his time and money to the business or industry in which he is engaged. No man has a moral right to withhold his support from an organization that is striving to improve conditions within his sphere. Teddy Roosevelt
Thank You!
Rick Tolman, CEO National Corn Growers Association – December 2009
