Skip to comments.As Price of Grain Rises, Catfish Farms Dry Up
Posted on 07/18/2008 5:43:35 AM PDT by TigerLikesRooster
As Price of Grain Rises, Catfish Farms Dry Up
By DAVID STREITFELD
LELAND, Miss. Catfish farmers across the South, unable to cope with the soaring cost of corn and soybean feed, are draining their ponds.
Its a dead business, said John Dillard, who pioneered the commercial farming of catfish in the late 1960s. Last year Dillard & Company raised 11 million fish. Next year it will raise none. People can eat imported fish, Mr. Dillard said, just as they use imported oil.
As for his 55 employees? Those jobs are gone.
Corn and soybeans have nearly tripled in price in the last two years, for many reasons: harvest shortfalls, increasing demand by the Asian middle class, government mandates for corn to produce ethanol and, most recently, the flooding in the Midwest.
(Excerpt) Read more at nytimes.com ...
Mmmmm...catfish from China.
Al Gore says we can raise Catfish on Solar and Wind Power. We don’t need no stinkin corn.
This congress is killing us at every turn
Can’t the fish just walk to new source of water?
I’ve seen a similar thing from the county farmer I buy my eggs from. The price of feed soared so his organic, free range eggs went from $1/dozen to $2. I can hardly complain; in the stores they’re now up as high as $4.00/dozen.
This is what happens when the gubmint mandates burning food crops as fuel - food shortages and high prices.
That's the bottom line, for a fact.
Our egglady came yesterday. 1.50/dozen and she delivers for free.
Is that why catfish are walking off the job in Florida?
I think the Mandarin phrase for "catfish farm" roughly translates as "sewerage treatment plant".
In all fairness, the article doesn’t once mention how high fuel and fertilizer prices (astronomical!) impact the corn and soybean producers. And except for a mention on the flooding, the article is short on acknowlegment of the inherently risky business of farming because of many weather, pest, weed and disease factors, the latter three more prevenatable or treatable but again, at a cost.
That said, the higher prices obviously do help the corn and soybean producers. But another reason the market has been so high are speculators and investment funds trading in the commodities. Which the article doesn’t mention either.
So is the presidency. It’s the “new tone in Washington.”
We drove by several catfish farms in Arkansas last week, and all appeared well. They were running aerators and pulling feed carts with brand new tractors. The catfish producers near us here in Louisiana are doing just fine as well. The article makes it sound as though catfish farming and processing is collapsing and that is just not the case.
December corn futures have fallen $1.37 since June 27. Ethanol is not to blame for high prices. Weather has been the largest contributing factor. Sometimes it doesn’t rain and you don’t harvest much. You have all of the expenses to pay for still. MAP fertilizer went from $200/ton to $1000/ton and Urea $160/ton to $700/ton.
Grains have been coming down off those ridiculous highs that's true, however I don't let ethanol off the hook particularly when it comes to the fuel vs. feeding animals decision the country will have to make sooner or later. It's mostly the investment funds that cause the market volatility we see these days.
Grains broke hard yesterday and with wheat to sell I'm watching carefully. But with markets the way they are anymore, wild and unpredictable and not necessarily based on traditional factors such as yields, weather and demand, it's anybody's guess what will happen and huge fluctuations over a two minute period aren't uncommon anymore.
It used to be the price of corn might not fluctuate ten cents in six months. Now however, it's best to hold onto one's hat.
Someone needs to tell Al that the sun don't shine at night and the wind barely blows.
I don't buy this argument about grains or oil. Speculators NEVER take physical delivery. Eventually every contract is delivered from an actual producer to an actual consumer. Speculators add liquidity between the two. For every contract bought by a speculator, one has to be sold. Actual supply and actual demand ultimately drive prices. If speculators drive prices of contracts up, some actual consumers MUST ultimately buy those contracts from them and the speculator will take a HUGE loss if there is not enough actual demand.
If you and I were electrical engineer climate scientist economic gurus like Al Gore. We’d understand how viable his plan is. If we were democraps we’d just believe him because the 2000 election was stolen from him.
Ethanol and it’s unintended consequences...
Buy stock in Cal-Maine, symbol CALM.
This is the country’s largest egg producer. They are making a fortune...
“This is what happens when the gubmint mandates burning food crops as fuel - food shortages and high prices.”
Brazil imports ZERO petroleum. They have freed themselves of dependence on terrorist oil, in less than 2 decades.
100% independence. Mostly with sugar cane. All Brazilian cars run on Alcohol or gas — and demand for gas is so low, Brazil actually sells gas back into international markets as an unwanted output from their refineries.
Brazil manages somehow, to feed Brazilians.
This whole “food or fuel” line is propaganda, nothing more.
We need to stop our dependence on oil.
Alcohol offers an EXCELLENT alternative. We can grow sources of input for alcohol production virtually everywhere in the country. Who will get rich?
Corn. Sugar cane. Even a lot of plants which are considered weeds, can be used to generate alcohol right here in America, and every single gallon produced, directly displaces a WILDLY OVERPRICED gallon of gas, which is paid for with dollars which go directly to terrorists and communists.
Heard a pretty interesting show last night on “Coast to Coast”. The guest’s assertion was, that the original Ford Model A was built to run on alcohol, and did so very efficiently. Alcohol has a higher octane than gas, and runs almost infinitely cleaner - with less wear on engines.
Ford was strongly in favor of running autos on alcohol.
Rockefeller, managed with several millions of dollars of lobbying (real money back then), fought back with ... prohibition.
Making the production of alcohol in America. ILLEGAL.
Thereby creating a gasoline monolopoly which continues to this day.
The caller’s assertion rings very true.
We need to move off gasoline as a nation.
In fact, the cost of fertilizer has quadrupled. (Made from oil.)
The “Organic” mantra will pretty much dry up as people see the difference in price and better quality from the “dirty-evil man-made” food products.
Here is a little fact for you....
If every acre of land was used for alcohol fuel production only, in this country, it would only provide us with less than 30% of our needs.
And how would there even be electric cars built without oil? All the plastics, rubber, lubrication, insulation, carpet and electronics could not exist without it.
But since you are an avid supporter of “Coast to Coast” that explains your boisterous ignorance.
Oil man, huh? :)
Yeah, that’s about what I pay for them, a little less.
Was recently in Italy. We bought eggs at the grocery and cooked breakfasts in our villa most mornings. The eggs there tasted great! I don’t know what they’re doing differently, but it was noticeable. The U.S. poultry industry should take a look at that.
“Here is a little fact for you....
If every acre of land was used for alcohol fuel production only, in this country, it would only provide us with less than 30% of our needs.”
Why does this remind me of Nancy Pelosi explaining if we start drilling now, we won’t see any more oil for at least 50 years?
You bet, we’re all in an evil plot to enslave the World!
Now, go back to your lilly pad and croak with the rest of the frogs.
But there are others of us, in an equally evil plot (to oil addicts anyway) to wean Americans from buying oil from terrorists and communists. Sometimes know as ...
(sorry can’t tell you that)
Our scheme? Make some farmers rich.
Raise the value of the dollar.
Turn around our balance of trade.
Stock market boom.
(evil, plot-like chuckle)
It also has 30% less B.T.U's than an equivalent amount of gasoline. George Noory wouldn't know or care about that.
” Eventually every contract is delivered from an actual producer to an actual consumer.”
Probably very few actual producers have sold their 2008 crop forfuture delivery at the high prices we have seen. The possibility of not having a crop to sell (hail, flood, drought, etc.) is too high to risk.
It is also likely that very few actual producers have sold any of their grain at the high levels. I would guess everyone sold on the way up and very little actual grain moved.
You know. George catches a log of flack, but he’s a Navy veteran, a libertarian, pro-RKBA and a lot of his guests are pretty darn smart.
Some, are raving lunatics.
Listeners, have to keep in mind at all times the phrase “caveat emptor”.
The guest speaking of alcohol, wasn’t one of the alien implant, or other screwballs.
He clearly knows his stuff. I’m leaning toward a flex-fuel vehicle as a short-term approach, until we’ve got even better choices available. Just as long as I can spend less money on terrorists, I’m all for it.
The guest’s server crashed because of the show — but here’s his book link:
I don't think you have done your homework. The actual loss in feed value is relatively small. Practically every ethanol plant either has a new adjoining large feed lot or there is a string of very large trucks on the road between the plant and existing feed lots.
Now, how much of that was ethanol, and how much was increased domestic production?
What is happening is a redistribution of the locations of feed lots. Feed lots a long ways from an ethanol plant are hurting. Given that the pain is largely due to government mandates for ethanol production, this isn't just a matter of market Darwinism.
Kind of like robbing banks, 'cause that's where the money is......
So why not use the empty catfish ponds to grow that species of algae that yields 10,000 gallons of diesel fuel per acre?
LOL! I will never be able to order one again.
I heard of an experimental farm that had come up with a mutually productive process that was almost independent.
To start with, they raised pigs. The fermented pig manure was put in a closed pond where it both grew algae and catfish. The algae was harvested along with the catfish for use both as pig food and fertilizer for crops. At each stage, they got out of it much more than they put in, including methane gas for energy.
The end result was that they produced pork, catfish and produce for sale, their water stayed pretty fresh with no contaminant build up, and their external expenses were minimized.
Alcohol doesn't contain any octane.
Octane belongs to a class of compounds known as alkanes, or straight chain hydrocarbons, or aliphatic hydrocarbons. The oct in octane means it has 8 carbons. Methane has one carbon. Butane has 4 carbons. Decane has 10. Ethane has 2 carbons.
You use the same prefixes to name the various alcohols. Methyl alcohol or methanol has one carbon. Butyl alcohol or butanol has 4 carbons. Octyl alcohol or octanol has 8 carbons. Ethyl alcohol or ethanol has 2 carbons
Now if you make alcohol with grain or sugar, you get ethanol. Wood yields methanol. Switchgrass would yield butanol.
On a volume to volume basis, butanol has about the same BTU content as that hydrocarbon blend known as gasoline while ethanol has about half the BTU content of gasoline.
But, alcohol is an oxygenate and contains oxygen. That oxygen in the alcohol makes it burn hotter/cleaner.
But, when you burn alcohol, you get formaldehyde as a by-product.
That would work if he had the acreage. Auquaculture can be a small acreage operation though.
If investment funds (I am referring primarily to commodity index funds buying futures as an inflation hedge) demand to own more contracts the supply can only be increased by finding someone to sell them those contracts generally at a higher price.
In 2003 commodity index funds had $13 billion invested in commodity futures markets. By the end of the first quarter of 2008 that amount had swelled to $206 billion dollars a twenty fold increase in five years. Estimates are that in the first half of 2008 about $1 billion dollars a day of new investment dollars were flowing into commodity index funds.
The buy and hold strategy of commodity index funds amounts to a virtual hoarding of food and fuel using commodity futures markets. As prices move higher many smaller food exporting countries begin to limit exports of food and fertilizer, which adds to the spiral in food costs.
I am NOT an advocate of barring or limiting any participant to the marketplace as long as they are abiding by the rules. That is a dangerous slippery slope, and speculators do help provide liquidity. IMHO Congress needs to focus their resources on steps to improve basis convergence between cash and futures markets and to ease cash flow needs on the operating budgets of true hedgers in funding margin requirements to carry true futures hedge positions. While it is true that speculators rarely are involve in delivery, if their long futures positions are holding deferred futures at a big premium it will often distort nearby futures and cash relationships.
The day will come when commodity index funds take their lumps, just like dot.coms and ridiculously inflated residential real estate were bubbles that had to burst. Until then the funds will be a major force in high commodity prices and volatile market moves.
When the day of reckoning comes and it will -- it will be hard for animal feeders to compete with heavily subsidized ethanol producers.
Risk management is not the same as risk aversion. When markets get completely out of kilter there is opportunity to take calculated risks. I opted to forward contract less than half of a normal production. Even if I had been hailed out we would have had no trouble buying the grain needed for harvest time delivery against our contract well below our contracted price. If we had no production and prices were higher than our contract we would have taken a hit some of which hopefully would have been absorbed by our crop insurance. That is why we would never forward sell over half of a normal expected production.
I would concur that very little grain was sold at the highest prices. It never is. A lot would have been sold on the way up. That which wasnt is probably still being held waiting (hoping) for prices to go back towards the highs.
Ain’t globalism grand. I’ll take my catfish with the adulterated heparin side dish.
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