Having watched the confrontations caused by expanding use of corn in making ethanol, grain-based foods has reason to be grateful that wheat has not become a feedstock competitor of the yellow grain. Based on history as well as market and political realities, corn has been the grain of choice as the ethanol industry has expanded. Indeed, corn producers have been a major force behind congressional mandates requiring inclusion of ethanol in motor fuel, and it is spokesmen for these growers who have been the most vigorous in protecting the domestic market against imports as well as efforts to curtail production. Only the combination of soaring corn prices and falling oil put a temporary crimp on ethanol growth. Now that both markets have reversed, ethanol output is on the rise and increasing quantities of corn are being diverted to this non-feed, non-food purpose.
Yet, an industry that will use an estimated 125 million tonnes of grain to produce ethanol, which is the International Grains Council’s estimate of 2009-10 world use, ought not be taken for granted. Of that global use, 87 per cent is in the United States, and practically all of the 108.6 million tonnes expected to be processed into fuel in America in 2009-10 will be corn. Corn’s share of global processing of grain to make ethanol is a slightly more modest 92 per cent, prompting a look at the other countries that are using wheat as well as other grains in the same production.
According to the I.G.C., only Canada, China and the European Union, the latter, of course, a group of countries, use wheat for making ethanol. While none of these is near to matching America’s output, their governments and their markets have acted so as to encourage wheat as a feedstock. It is in the E.U., which raises less corn than it feeds, that wheat is the principal grain to make ethanol. Of the 7.6 million tonnes that the E.U. will process into ethanol this year, wheat accounts for 60 per cent, followed by maize and barley. This is not surprising in light of how the European starch industry largely depends on wheat as its ingredient, instead of the U.S. reliance on corn. In Canada and China, small quantities of wheat are used in comparison to maize. But if China’s wheat use share, at 8.5 per cent, was applied to America, it means 9 million tonnes of wheat, or a third of domestic food use.
Based on what’s happening in other parts of the world, as well as in the U.S. ethanol industry, it would require a total realignment of wheat and corn prices to draw even relatively small quantities of wheat away from flour milling into industrial processing. Yet, considerable research is under way to examine the potential for wheat and wheat flour in new uses. Thus, it would be wrong to dismiss these efforts as lacking promise, keeping in mind the way that ethanol, once no more than a dream of its advocates, has revolutionized the corn industry and the corn market.
Nothing reinforces this more powerfully than the realization that corn, once considered mainly, if not solely, as the premier grain for feeding livestock and poultry, is now being challenged in the United States by industrial use. The latter, propelled on a steep upward course by expanding production of ethanol, will this crop year, for the first time in history, come near to equaling the quantity fed to animals. Both industrial use and feed use will be around 135 million tonnes out of a near record crop of 330 million. At the start of this decade, feed use was more than 2½ times industrial use. With that volume, it isn’t beyond the pale that wheat may be seized upon as having a potential role, a development that could have huge consequences for an industry like grain-based foods.