Rising feed prices hurting US turkey industry
June 29, 2011
by Meat&Poultry Staff
WASHINGTON – Rick Sietsema, partner and chief financial officer of Sietsema Farms in Allendale, Mich., told the Senate Committee on Agriculture, Nutrition and Forestry that the current increase in feed prices is due to short corn supply caused by the federal ethanol mandate and it has created significant uncertainty on US the turkey industry, according to the National Turkey Federation.
While feed accounts for 70 percent of the cost of raising a turkey, corn is 70 percent of the feed ration. Corn has risen from $4 per bushel to more than $7 in barely a year.
Sietsema Farms, a member of Michigan Turkey Producers Coop., raises one quarter of the 4.6 million turkeys produced and marketed both domestically and internationally by the co-op. “The turkey industry is looking for reform of the existing ethanol policy, a safety net that ensures corn prices and availability will be less volatile in the future,” Sietsema said.
Another challenge facing the industry is USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) proposed marketing rule, he also told committee members. The competitive injury provision in the proposed rule will make it easier to sue or bring regulatory action against livestock and poultry processors. Also of concern is the provision requiring processors to virtually guarantee growers they can recoup 80 percent of their capital investments. Sietsema added that studies have found the proposed rule would have negative impact of more than $360 million annually in the turkey industry.
Sietsema commended the government’s involvement and encouraged their continued support in the Environmental Quality Incentives Program (EQIP). He praised Chair Debbie Stabenow (D-Mich.) and the committee for its leadership in securing EQIP funding.
“Continued funding of EQIP is imperative for our industry’s ability to implement conservation practices,” he said. “On behalf of the industry, we are pleased that the 2008 Farm Bill kept 60 percent of the funds for animal agriculture and would hope those funds will be continued in the next Farm Bill.”
Sietsema described how his company utilized EQIP for building several manure storage facilities. “In the near future our turkey litter will be delivered to our new state-of-the-art biomass gasification facility, closing the environmental loop and reducing our carbon footprint,” he said. He added his company proactively works with USDA’s Natural Resources Conservation Service to ensure environmental stewardship.