We often tend to view the equine industry as a separate entity--one that stands apart from the overall economic infrastructure. After all, it is far different from manufacturing and the business world in general. However, quite the opposite is true. The equine industry is part and parcel of a fragile infrastructure that, at the moment, has raised the ante for owning a horse.
A specific problem for today's horse owners in many parts of the country is lack of hay. The scarcity of hay is the result of a complex set of circumstances. The least complex part of the equation is the fact that many areas of the country have been suffering from a drought. Florida is a prime example. Very little hay was harvested in the state last year. This means that horse owners had to purchase and ship in hay from other regions to feed their animals.
That immediately drives the price higher because fuel costs have continued to escalate, and it takes a good deal of diesel fuel to power a huge semitrailer loaded with hay.
The complexity begins when we consider the ramifications of using ethanol to cut fuel costs. On the surface, this seems a panacea. We are able to use a renewable resource to produce a less expensive, less polluting fuel than that produced by nonrenewable fossil fuels.
However, it isn't all that simple.
What the Hay?
The demand for corn used in ethanol production has driven prices for that commodity higher than they have ever been. Well, we can reason, we don't feed all that much corn to horses, so that shouldn't have a strong impact on the equine industry, right?
The problem is that the price increase for corn means farmers can make more money raising corn than they can hay. This translates into hay meadows being plowed under and replaced with either corn or wheat. According to agricultural officials, hay acreage across the nation is expected to decrease by another 2% during the coming year. Texas is expected to have the largest decrease with the conversion of 390,000 acres from hay to other crops.
It isn't a problem that just surfaced; there has been a trend. The USDA reported that U.S. hay stocks had dropped to an 18-year low of 96.4 million tons as of Dec. 1, 2006. The report said that stocks had fallen by 8% since 2005.
The Kansas Agricultural Statistics Service, as quoted in a February 2007 report by Kansas State University, rated hay and forage supplies at 51%--very short to short, 48% adequate, and 1% surplus, as of Feb. 4, 2007. The report stated that hay supplies were short within the state, and that feed supplies in general were short in Western and Southern areas.
Another example of a Southern state with a hay shortage problem is North Carolina. Extension officials there report that drought, combined with a killing frost in April 2007, drastically cut into the projected hay crop, and horse owners are still scrambling to find supplies.
Wheat Plays a Role
The growing cost of wheat is another part of the complex puzzle. The price of a bushel of wheat has increased by 50% since August of last year, and the increase is even greater for the more sought-after wheat varieties. Again, a subset of complex circumstances is involved.
In recent years there have been poor wheat harvests in Australia, parts of Europe, and the United States. Foreign countries, spurred by a weak U.S. dollar, are seeking to purchase more and more wheat from the United States. These countries include China, Mexico, Nigeria, South Korea, Taiwan, and Venezuela.
Stockpiles of wheat in the United States are at historic lows, and prices are at historic highs.
The USDA's 10-year forecast indicates that the wheat shortage is temporary; stockpiles will fall this year to 312 million bushels, down from 456 million bushels, before rising to approximately 750 million bushels by the end of the decade.
All of that won't help in the hay supply category. Some varieties of wheat are selling in the $16 to $18 per bushel range, and that means farmers who don't convert hay acreage to corn will be tempted to plant more wheat and cash in on the current soaring demand.
Ultimately, however, it appears the continuing demand for corn to produce ethanol will have the major impact on hay supplies.
According to the USDA's National Agricultural Statistics Service, farmers planted 92.9 million acres of corn in 2007, an increase of 14.5 million acres over the previous year.
American farmers produced 10.74 billion bushels of corn in 2006, according to a position paper published by the American Coalition for Ethanol (ACE). The paper predicted that by 2015, American farmers would be producing 15 billion to 16 billion bushels annually and, perhaps, as many as 18 billion bushels. The USDA predicts the 2008 corn crop will be in the neighborhood of 13.5 billion bushels.
Some of the increase, according to ACE, will be the result of improved (plant) genetics, but it is likely that a majority will be from additional acres planted with corn.
Ethanol came onto the scene as a moving force in 1990 when the Clean Air Act amendments were passed by Congress. The amendments mandated the sale of oxygenated fuels in areas with unhealthy levels of carbon monoxide. Although ethanol had been around long before that, the amendments provided the stimulus for a demand that is still growing.
The demand will continue to grow. Government mandates have put the production of ethanol on the fast track. One stated goal is for 37 billion gallons to be produced annually by 2017. This has resulted in a great deal of research being conducted at both the governmental and private levels. The good news on the agricultural front is that much of this research involves finding ways to produce ethanol from plants other than corn. The USDA Research Service says some of the studies involve extracting lignocelluloses--structural materials present in the mass of all plants--and using them as an option to replace corn sugars in biofuel production. One of the sources for this process was listed as switchgrass, which is plentiful and doesn't figure into food supplies for animals.
Corn to Fuel: How it's Done
There are two basic ways to convert corn to ethanol--the "dry" method and the "wet" method. About 80% of the ethanol processing plants take the dry method approach.
In dry milling, the entire corn kernel is first ground into flour, which is referred to in the industry as "meal," then it is processed without separating out the various component parts of the grain. The meal is then slurried with water to form a mash, and enzymes are added to convert the starch to dextrose. The mash is then processed in a high-temperature cooker, after which it is cooled and transferred to fermenters, where yeast is added and the conversion to ethanol and carbon dioxide begins.
In wet milling, the corn is first soaked or "steeped" in water and dilute sulfurous acid for 24 to 48 hours. This steeping facilitates the separation of the grain into its many component parts. After steeping, the corn slurry is processed through a series of grinders to separate the corn germ. There are a number of other steps, but in the end a fermentation process produces ethanol.
According to recent industry reports, one bushel of grain produces about 2.8 gallons of ethanol and 17 pounds of a product called distillers grain. The ethanol industry touts distillers grain as an important cattle feed, although it is not mentioned as an appropriate food source for horses.
The ethanol production process utilizes most of the starch in corn. Therefore the corn's other components, for example, protein, fat, fiber, are increased.
Joe Pagan, PhD, founder and president of Kentucky Equine Research based near Lexington, has performed research on distillers grain (from whiskey distillers), and its suitability for equine diets. "Even though it's high in protein, it's not a direct substitute for a good protein source like soybean meal (which also is affected by the ethanol industry: due to expanding corn production, fewer acres are being planted with soybeans)."
Pagan explains that distillers grain can be highly palatable for horses when it is dried properly (not burned), and it is especially attractive during this age of low-starch diets, just as long as distillers use corn free of aflatoxins, which are mycotoxins produced by mold. But according to Charles H. Staff, executive director of the Distillers Technology Council in Louisville, Ky., fuel ethanol distilleries--like whiskey distilleries and other fermenting facilities producing products for human consumption--must ensure that aflatoxin levels are below what the FDA and its Center for Veterinary Medicine have established as maximum aflatoxin levels for animal feeds and human food.
Unless the ethanol plant is nearby, the cost of shipping the product is inordinately high compared to the food value it represents.
So, still another piece is added to the complex puzzle. High corn prices are pressuring the beef industry to find other feed sources, with some of the emphasis on the same high-quality hay that is desired for horses.
Options for Horse Owners
The question at this point involves options available for the horse owner during the ongoing hay shortage. The best possible remedy, of course, would be for adequate rain to fall throughout the drought areas nationwide. Droughts tend to run in cycles, so that is not a pipe dream, but the reality is that it likely won't happen all over at the same time.
The other good news is that while hay acreage is expected to decrease by another 2% nationwide this year, there are areas of the country where it is expected to increase. The states with the largest expected increase, according to agricultural officials, are Kentucky, Montana, North Dakota, Ohio, Pennsylvania, and Wyoming, with lesser increases forecast for California, Nevada, and Oregon.
Perhaps one of the best approaches for horse owners is to solicit the aid of agricultural extension service specialists, who often have access to information about hay availability. Then, perhaps, they can form coalitions so that when hay has to be shipped into an area, a number of consumers are sharing the costs.
About the Author
Les Sellnow is a free-lance writer based near Riverton, Wyo. He specializes in articles on equine research, and operates a ranch where he raises horses and livestock. He has authored several fiction and non-fiction books, including Understanding Equine Lameness and Understanding The Young Horse, published by Eclipse Press and available at www.exclusivelyequine.com or by calling 800/582-5604.