Since June of 2007 I have been blogging about the increase in E. coli illnesses and recalls after years of decreases. Those increase have continued well into 2008. It now seems every day there is another outbreak. Colorado, Vermont, Michigan, Iowa have all seen outbreaks in the last few days.

Minnesota Public Radio Mark Steil reporter reported on Friday what many have long suspected, and that a USDA study confirms, that there is link between ethanol by-product and E. coli.  A U.S. Agriculture Department study shows a significant increase of potentially harmful E. coli bacteria in cattle that are fed an ethanol by-product known as distiller’s grain. Distillers grain is a common ingredient in cattle feed. But researchers say it’s too soon to know whether cattle producers should change the amount of distiller’s grain they feed to their herds. See the full story – “USDA study confirms link between ethanol by-product and E. coli.”

In December of 2007 I wrote about one of the causes I suspected in this E. coli uptick:

High oil prices: They get blamed for everything else, so why not food-poisoning? The theory is that $3 gas has fueled the growth of ethanol plants. Those plants tend to be built next to feedlots, because the plants produce a byproduct called distiller’s grains, which serves as an excellent feed for livestock. Problem is, according to research at Kansas State University, the distillers grain also increases the incidence of E. coli in the hindguts of cattle.

As I wrote in January of this year:

There are as many theories as there are authorities, researchers, and meat packers. Some of my thoughts from December 2007 surfaced again in Phil Brasher’s article, “Scientists study possible link between ethanol byproduct and E. coli.” A nationwide surge in beef recalls has pointed the finger at an unlikely culprit – the nation’s fuel ethanol industry. Studies at two universities suggest that feeding cattle a byproduct of ethanol production known as distillers grains may increase levels of a deadly form of E. coli bacteria.

It seems to be about saving or making a buck. According to the Iowa Cattlemen’s Association, cattlemen pay $35 a ton for distillers grains, the equivalent of $2.85 a bushel for corn. In Iowa corn has been selling for more than $4 a bushel. It takes about 33 bushels to make a ton. It takes the equivalent of 70 bushels of corn to fatten a steer. So if I did my math correct, if you feed a steer corn, it costs about $132 to fatten it; if distillers grain is used, $75. Hmmmm, I wonder if that has anything to do with it. It will be interesting to see the cattlemen explain that to a jury in an E. coli case.

I found some interesting quotes about the price of steers and how the costs of inputs like, corn vs distillers grain, might drive risky decisions – “In The Cattle Markets” – A weekly newsletter jointly produced by Kansas State University, University of Nebraska and Utah State University.

“Feedlots seem to be signaling that they would prefer to place feeders at heavier weights and avoid feeding that high priced corn. Fed cattle weights have also been declining since November of last year and are now below the 5-year average. That decline may also reflect a dislike for feeding high priced corn…. Packer margins have likely improved in the last few weeks but feedlots are probably losing over $100 per head on most sale lots…. Lower returns and increased risk is the current state of the industry.”

So, what are industry and the Government going to do about it? Another study? Watch more people get sick? Send more clients to my office? For an industry and a Government that claims to not like lawyers, they sure are keeping me busy.