Milling & Baking News - August 12, 2008 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS AUGUST 12, 2008 / Ethanol industry growing amid slim profits, high corn prices and political uncertainty T A crop circle near Denver International Airport was unveiled Aug. 7 to celebrate the introduction of Papa John's 100% whole wheat crust pizza. Story on Page 8 LATE NEWS Flour production down in quarter WASHINGTON - Even though flour production by U.S. mills in the second quarter of 2008 decreased 0.6% from the same 2007 quarter, the January-June 2008 output aggregate still managed to set a record for those six months. The current quarter despite the reduction also ended up the third largest April-June on record. All this is according to data issued by the Bureau of the Census of the U.S. Department of Commerce. Flour output in January-June 2008 totaled a record 203,456,000 cwts, up 700,000, or 0.3%, from 202,756,000 in the first half of 2007. The April-June decrease from a year earlier, however, ended a remarkable Continued on Page 8 he ethanol industry that just two pected it to do," said Mary Holmes, years ago was eying what ap- director of biofuel programs and busipeared to be unending potential ness development for the National Corn and broad political support has in the Growers Association. She considered last few months witthe current situation nessed record high a "correction" for the The Environmental corn prices, tightenethanol industry. Protection Agency denies ing credit and ongoBut while the Texas request for a 50% ing - if not growing bloom appears to be - negative public off the ethanol "rose," reduction to the 9 billion and political opinion new plants still are gallon renewable fuels and is showing signs under construction, standard. See story of stress amid slim output continues to on Page 24. margins, construcgrow, imports are tion delays and even increasing despite a bankruptcies. 54c-a-gallon duty and demand still outFurther clouding the outlook for paces production. ethanol are record high and now fallPerhaps the pivotal point this suming crude oil, gasoline and diesel prices, mer was last week's ruling from the rising food costs and continued strong U.S. Environmental Protection Agenopinions for and against the use of crops cy on a request from the state of Texas for food and fuel, all in the setting of a to halve the Renewable Fuels StanU.S. presidential election year in which dard (R.F.S.). Texas on April 24 reenergy prices, especially gasoline, have quested the E.P.A. suspend 50% of the become a hot political issue. R.F.S. for alternative fuels made from Continued on Page 21 "The industry is doing what we ex- C.S.I.S. weighs in on food crisis, with some controversial proposals WASHINGTON - A study prepared for the Center for Strategic and International Studies and issued at the end of July called for bold U.S. leadership in confronting the global food crisis and a reorientation of U.S. foreign assistance to give priority to food security. The report, "A Call for a Strategic U.S. Approach to the Global Food Crisis," was the product of a task force assembled by the C.S.I.S. to develop policy recommendations. Some task force proposals were expected to receive broad support while others were more controversial, including a shift toward relying primarily on local or regional cash purchases of food in developing countries for use as U.S. emergency aid. The task force was chaired by Senator Robert P. Casey of Pennsylvania and Senator Richard G. Lugar of Indiana. Members were drawn from staffs of the C.S.I.S. and the Senate Committee on Foreign Relations as well as several research and charitable organizations. Absent were representatives of producers, the food industry and non-governmental organizations supportive of current food Continued on Page 16

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Milling & Baking News - August 12, 2008