Interview with Dave Mickley, Farmer on Biofuels, Food and More - 4/16/08
1: Dave, give us some information about yourself.
I am a smaller than average producer from Northwestern Illinois raising corn, soybeans, seed corn and wheat. I own 160 acres and crop share rent an additional 530 acres. I do work closely alongside my father who farms 600 acres.
2: Do you think the government mandate for the production of 36 billion gallons of biofuel by the year 2022 is realistic for the famers to meet?
It all depends on the price of oil. If it continues to run higher along with good demand, certainly profit incentives will exist to create various forms of biofuels to meet demand more so than the mandate.
3: How much corn do you believe is dedicated to the production of Ethanol?
Tough for me to accurately say. I understand it is currently around 20%. However the by-product DDG's is a substitute for cattle feeders to whole corn. So it is to simple to look at it as a bushel to bushel exchange. I believe greater efficiencies with the ethanol by products can be a key development in reducing the fuel versus food argument.
4: Are farmers planting more corn than wheat and other crops because of higher price and demand?
In my area no. Wheat is a dry crop and corn utilizes greater precipitation. My part of the world lends itself much better to corn production, just as North Dakota does to small grains. Those areas on the fringe could do some acres switches, but for the heart of the corn belt to switch we would require extreme price differences between commodities.
I am all for farmers finally making more money.
5: With corn and wheat doubling in the last year, do you believe agriculture commodities will continue with higher prices over the next year?
I do believe the downside risk is small. Are we approaching the top? If we raise a good crop I do believe these prices will stall.
6: Jim Rogers, billionaire and author of Hot Commodities believes we will be in this commodity super cycle of higher and higher prices till 2015. What do you think?
Major keys in my eyes to keep this going. China, India, oil prices, government policy, recession. I think I have them pretty close to order of importance as well.
7: Do you see farmers not rotating crops by planting corn on corn and will this harm their land?
Most certainly crop rotation in the corn belt has shifted to more corn. I see very little risk to harming the land. I have a neighbor whose farm has seen soybeans once in the last 20 years. It continues to be an excellent farm. A non issue in my eyes.
8: Do you think the demand for Ethanol is part of the reason prices are increasing in agriculture commodities?
Sure, ethanol demand is equivalent to roughly what we used to export. An export market I might add that was difficult to count on. But to count ethanol as the only source of increased commodity prices is flawed. Increased consumption worldwide of all commodities is obviously a major driver. Perhaps a more subtle driver is the popularity of investing in commodities. Index fund money is huge and I believe the money snowball has created some of this run up as well.
9: Recently there have been reports of many foreign countries agriculture stock piles getting low, causing them to stop exporting these items. What do you think will be the result of this?
Continued strong support for commodities, marginal ground being brought back in to production, technology breakthroughs to respond to profitability.
10: The use of agriculture waste or biomass to produce ethanol has been a resent topic of discussion. Do you have any opinions on this subject?
I don't see a large potential for ag waste products such as corn stover. Many nutrients are returned to the soil from that stover. Commercial fertility is an petroleum priced product, so to replace those nutrients would not seem economically viable. I do believe switch grasses, mescanthusis, fast growing trees have good potential on land that is not currently in production.
11: Do you convert any of your corn to ethanol to be used in your farm equipment?
No, much more efficient to simply purchase it. We use soy diesel in all our tractors, and ethanol in all our vehicles.
12: Do you think genetically modified seeds or crops create any concerns to our food supply, or is genetically modified seeds a good thing?
GMO is a wonderful thing. Tremendous efforts and dollars are invested in these technologies. It takes 10 years or more of research to develop the desired output.
I have cut my pesticide use by 80% since adopting the technologies. Before when spraying we use to kill the beneficial insects as well as our target. Now only the target is eliminated. Herbicide use has also been cut and the products used have shorter half lifes. Groundwater quality is sure to improve. GMO is misunderstood by many because it is relatively new. But consumers are sure to benefit shortly. The introduction of soybeans to eliminate the need for hydrogenation of oils to increase shelf life of foods will lower trans fat content in foods. Wheat will be enriched with balanced vitamins and minerals to complete diets of poorer countries. Corn will have the ability to withstand drought better than ever and smooth our production from year to year. More efficient use of nitrogen will increase the quality of our water. When hybrid corn first began being utilized instead of open pollinated corn, the same doomsayers rejected that notion. We have been here before with the fear of the unknown, speculation, and conjecture. Bottom line GMO is a big part of our ability to feed a growing world.
13: Is the certified organic food industry really safe or is there something misleading about it as well?
Strictly opinions on the organic food questions as I have no direct experience. I feel the certified organic food industry is more marketing than substance. Determining what is organic is really quite complex. Do you include commercial fertilizers, past practices, seed type, what herbicides, etc.? Is selective crossbreeding in animal really natural? To mass produce food we have developed a system that is efficient, low cost and regulated by the USDA, EPA, and FDA. If someone so chooses to spend more for organic then more power to them. I do not think they are getting their perceived value for the extra money spent.
14: Do you think the best bet is to shop at locally grown organic food or farmer’s markets and why?
I do believe local markets whether organic or not can be a better choice to shop at. I don't buy into the organic premium, but I do for freshness. I believe as consumers watch cooking shows and eat at restaurants promoting fresh ingredients that their is real value there. I also like the fact that a smaller producer can fill this niche without needing large acres or capital to run an operation.
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