"Big Shift in American Farm Policy" - Farming as a Low-Carbon Energy
Producer
Keith Schneider reported in today’s New York Times that, “Despite
federal and state programs to convert corn into ethanol and soybeans
into biodiesel to fuel cars and trucks, the
United States has never before regarded farming as a primary energy
producer.
“That changed when
Congress in August passed the climate provisions of the Inflation
Reduction Act, which provides $140
billion in tax incentives, loans and grants to replace fossil
fuels with cleaner renewable energy that lowers emissions of carbon
dioxide.
“Along with the wind and the sun, the
raw materials needed for a significant portion of that energy come
from agriculture — alcohol from fermenting corn, and methane
from the billions of gallons of liquid and millions of tons of solid
manure produced by big dairy, swine and poultry operations.
"Despite
pushback from environmental groups concerned about increased
pollution from farm waste, developers across the country see
opportunities to build ambitious renewable energy projects to
convert crops and agricultural wastes to low-carbon energy.
Schneider explained that, “The
emphasis on energy production is a big shift in American farm policy that
started in the early 1970s when Earl Butz, the secretary of
agriculture during the Nixon administration, encouraged farmers to
plant ‘fence row to fence row.'”
“The government’s plan to turn agricultural products into energy is
intended to increase economic output, said John E. Ikerd, professor
emeritus of agricultural economics at the University of Missouri.”
![](images/images_04_10_2023/Screenshot-2023-04-05-at-6.31.50-AM-768x634.png)
The New York Times (Page B5 – April 5, 2023).
Today’s article noted that, “One of the newest projects is on a
245-acre field just outside tiny Lake Preston, S.D. Last September, Gevo,
a Colorado developer, broke ground for Net-Zero
1, an
$875 million refinery to turn corn into low-carbon jet fuel.
“Gevo says its ‘farm-to-flight’
project will release 80 percent less carbon dioxide to the atmosphere
than ethanol made by a conventional plant. A wind farm will power the
plant, which will turn 35 million bushels of corn from about 100 South
Dakota growers into 65 million gallons of jet fuel a year.”
“None
of it would be possible without government support,” the
article said. Adding that: “Virtually
every phase of Net-Zero
1 production, and a good portion of its revenue, benefits
from tax incentives, grants and direct payments for low-carbon
renewable energy and the nearly $20
billion that Congress has approved since 2021 for the
disposal of carbon dioxide. When the plant begins production in 2025,
it will qualify for a clean fuel tax
credit of $1.75 a gallon, plus an $85
tax credit for every ton of carbon dioxide it disposes of in
deep subsurface caverns.
“That’s not all. Congress also directed $40 billion to the Department
of Energy for loan guarantees to finance innovative carbon-reducing
projects. Gevo expects the department to approve a $620 million loan
guarantee to pay
for 70 percent of the Net-Zero 1 construction costs.”
The Times article also pointed out that, “Thousands
of large livestock operations are also poised to take advantage of the
tax benefits and subsidies. The American Biogas Council, an
industry trade group, counts 2,300
biodigesters in operation in the United States that convert
organic wastes to methane to burn in power plants or be used as
transportation fuel. With tax credits in the new climate law, the
council envisions
the installation of 15,000 more, including 8,600 on large
dairy, hog and poultry farms.”
In other news, Reuters
writers Alan Charlish and Pawel Florkiewicz reported today that, “Polish
Agriculture Minister Henryk Kowalczyk resigned from his post on
Wednesday amid rising anger
among farmers over the impact of Ukrainian grain imports on prices.
“Kowalczyk said he decided to quit the position due to the European
Commission’s decision to extend duty free imports for Ukrainain grain
until June 2024. Polish farmers had called for the
introduction of tariffs.”
Elsewhere, Reuters
writer Enrico Dela Cruz reported today that, “The U.S. Department
of Agriculture (USDA) in its first
weekly crop progress report of the 2023 growing season rated 28%
of U.S. winter wheat in ‘good-to-excellent’ condition, the lowest
score for the time of year in records dating to 1989.
Last year, the US set a 21st century record for lowest winter
#wheat
condition index to start the growing season (value of 179). We
tied that mark today, with an initial condition index of 179.
![](images/images_04_10_2023/pic5%20copy.jpg)
“However, traders said improving
weather forecasts eased
worries about planting in the United States, with a
turn to warmer and drier conditions later this week projected
following blizzard
warnings on
Tuesday across most of the northern Plains spring wheat belt.”
![](images/images_04_10_2023/pic6.gif)
National Weather Service. Climate Prediction Center. 6-10 Day Outlook
(April 4, 2023).