EPA Backs Big Ethanol Against Farmers

In light of the big drought in the Midwest this summer, livestock farmers are concerned about the price of corn.

In light of the big drought in the Midwest this summer, livestock farmers are concerned about the price of corn. Consequently, a lot of farm organizations petitioned the Environmental Protection Agency to suspend the Renewable Fuels Standard which requires that 13.8 billion gallons of ethanol (equivalent to 4.5 billion bushels of corn) to be blended into gasoline in 2013. Biofuels Digest reports the following from a spokesman from the American Ethanol Coalitions:

"Despite millions of dollars spent by Big Oil and Big Food to shamelessly attack American-made ethanol, it comes as no surprise EPA denied the requests to waive the RFS because the facts are on our side," said Brian Jennings, ACE Executive Vice President. "EPA considered the flexibility built-into the RFS, precedent established in 2008, and data which proved waiving the RFS wouldn't remedy the harm of the drought in making the right decision."

Big Ethanol evidently wins!

The price of corn is up 17 percent since April. A coalition of farming groups emailed a press release decrying the EPA's decision:

USDA's Nov. 9 crop report puts this year's corn harvest at just 10.7 billion bushels, down 13 percent from last year and down 28 percent from USDA's May projection.  The ethanol industry will use more than 40 percent of the corn supply next year. 

Further, the carry-over stocks for 2012-13 are now forecast at 647 million bushels, less than 5 percent of expected corn usage and the lowest amount ever.  This is a 35 percent decrease from last year's carry-over amount.  This means there likely would be no corn reserves for next year should the country experience another poor crop. 

The coalition asked:

How many more jobs and family farms have to be lost before we change this misguided policy and create a level playing field on the free market for the end users of corn?"

Great question. An even better one is: When will government level the playing field on the free market for the end users of energy?