Iowa Farmer Today
0318/06
Ag’s long reach in Iowa industry
By Hannah Fletcher, Iowa Farmer Today
MUSCATINE -- A trail of corn kernels sprinkle the railroad tracks that lead to the
Grain Processing Corp. (GPC) plant here in this Mississippi River town.
The corn trail is not unusual. It is the GPC plant’s chief item it processes to make
products for livestock, food and pharmaceutical the industry, said Jerry Johnson,
public relations director for GPC.
Since its inception in 1943, GPC has expanded the number of its corn-based
products.
“It started as an alcohol-processing plant for the government during World War II.
The alcohol was used to produce synthetic rubber,” he said.
Today, livestock feed is a major product for GPC, which includes three feed
companies: Kent Feed in Muscatine; Evergreen Mills, in Ada, Okla.; and Blue
Seal, in Londonderry, N.H.
“Livestock feed is still has the largest impact on the corn industry. But, corn does
have other applications,” Johnson said.
From corn, the company extracts corn syrup, starch, gluten, oil, and ethyl alcohol
that are often shipped elsewhere to be further manufactured into various
products.
For example the gluten may be used in animal feed; the alcohol may be used for
beverage or industrial use; and corn syrup or starches may be used in food,
pharmaceutical, or personal-care products.
“If you look at typical items from the grocery store a large percentage of them
contain corn starch or corn product,” he said.
The people at GPC recognize their business’ existence and success thrives on
the success of Iowa’s farmers, he said.
“We are very dependent on the corn that is produced in Iowa and Illinois,”
Johnson said.
“We also watch everything that affects the market and production of corn in the
state,” he said.
Johnson said it is easy for people who work for an ag-related business to
recognize their dependence on agriculture.
Companies, such as GPC, are not unique.
“There are a number of agribusinesses that contribute to the health of Iowa’s
economy,” said Steve Gehrls, outgoing chairman of the board for the
Agribusiness Association of Iowa.
“As Iowa is an agricultural state, (agriculture) gets a big chunk of the state’s
economy.”
Gehrls said it is not unusual for businesses closely linked to agriculture to
celebrate when farmers celebrate, he said.
“As a farmers’ income increases or the number of bushels and livestock
increase, the more they are able to invest in the community and support
agribusinesses,” he said.
Gehrls, who is also district sales manager for Dow AgroSciences in Des Moines,
said farmers are more willing to invest in technology when yields and income are
good.
“For a farmer to do his job, he relies on the seed industry to provide quality
product, the equipment industry to make improvements in technology, the
transportation industry to move the grain or livestock, and the financial industry to
provide the credit. The list goes on,” he said.
Gehrls said some people may be surprised to realize the hold agriculture has on
the state’s economy because of the various connections to businesses and the
people who work there.
According to “The Economic Importance of Agri-Food Industries in Iowa,” a study
by Mark Imerman, Iowa State University economist, Iowa food processors
generated 4.5 percent or $4.4 billion of Iowa’s Gross State Product — the third
highest effect in the nation.
Total processing of ag products in Iowa generates 51,071 jobs and labor income
of $2.27 billion in Iowa, according to Imerman’s study.
“If you stripped away all the businesses that are dependent on agriculture, it
would be interesting to see what the state’s economy would look like at the end
of the day,” Gehrls said.