RFS Reform Act proposal would eliminate biofuels mandate

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Legislation was proposed Wednesday by four U.S. Congressmen that would ease what they believe are the impacts of the ethanol mandate “and protect consumers, energy producers, livestock producers, food manufacturers, retailers and the U.S. economy.”

The Renewable Fuel Standard Reform Act, introduced by Reps. Bob Goodlatte (R-Va.), Jim Costa (D-Calif.), Steve Womack (R-Ark.) and Peter Welch (D-Vt.), would eliminate the biofuels mandate, beginning in 2014, and rescind the requirements of blending up to 15 percent ethanol into the fuel supply. The proposal would prohibit corn-based ethanol from being used to meet the RFS, and reduce the total size of the RFS by 42 percent over the next nine years.

A coalition of 13 food groups expressed support for the proposed legislation which they believe will protect food makers and consumers from unnecessary food price increases.

Grocery Manufacturers Association president and CEO Pamela G. Bailey, said, “Americans need responsible energy policy solutions that do not pit our nation’s energy needs against food security for millions of families. GMA applauds Reps. Goodlatte, Costa, Welch and Womack for taking an important step towards reforming the ill-conceived food-for-fuels policies that are driving up the cost of food for consumers when they can least afford it.”

The National Cattlemen’s Beef Association (NCBA) and the National Pork Producers Council (NPPC) also issued a statement in support of the legislation.

“Cattlemen and women are self-reliant, but in order to maintain that we cannot be asked to compete with federal mandates like the Renewable Fuels Standard for the limited supply of feed grains,” said NCBA Policy vice-chair Craig Uden, an Elwood, Neb., cattle feeder. “In light of the worst drought to hit our country in over 50 years and the ever increasing renewable mandates, we are seeing many of our members not only failing to profit, but taking a loss.”

NPPC President Randy Spronk, a pork producer from Edgerton, Minn., said, “It is clear, when EPA is unable to provide even a temporary waiver of the RFS during the worst drought in 70 years to assure adequate feed and food supplies, that something is broken and needs to be fixed. We applaud Congress, and especially Congressmen Goodlatte, Costa, Womack and Welch, for beginning this long overdue conversation on the RFS and for offering reasonable solutions to address problems associated with that mandate. We need to reform the RFS.”

The Renewable Fuels Association, however, claims the proposed legislation represents “circular logic.”

“You can’t say ‘we support biofuels’ and then pull the rug out from underneath companies that relied upon government policy and are now building biorefineries that create hundres of construction jobs at each location or are hitting milestones in new production,” RFA president and CEO Bob Dinneen said.

Brooke Coleman, executive director of the Advanced Ethanol Council, says the proposed legislation “gets points for being creative. Disguised as a reform effort supportive of advanced biofuels, the RFS Reform Act actually guts the RFS by eliminating key provisions that require oil companies to actually change their behavior and buy renewable fuels. It is not a coincidence that the American Petroleum Institute (API) has been asking for these modifications to the RFS for years. But the RFS Reform Act is even more disingenuous than that. While stating that he merely wants ethanol to compete in a free market, in the same breath Congressman Goodlatte proposes to ban ethanol from 90 percent of the market. If there ever was a definition of free market fit for the oil industry, this is it.

“It is doubtful that the sponsors of this legislation truly believe that the best way to promote second generation biofuel is to kill first generation biofuel and provide Congressional protections for the oil industry’s monopoly over the fuel blend in the process,” Coleman says. “This is just a smokescreen for going after the one alternative fuel and the one policy that has fundamentally disrupted oil industry control of the marketplace while saving consumers money at the pump.”

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NE  |  April, 11, 2013 at 08:56 AM

check the meat price spreads at ERS Meat Price Spreads and ask why it takes asmucht to retail a fed beef animal and twice as much for a butcher hog . The Cheap Corn Coalition does not want to discuss this.

mo  |  April, 11, 2013 at 10:30 AM

lets see if I understand this right - now that the American and world farmers have adjusted to the increased demand for corn the rug is going to be pulled out from under us again. this year we will produce enough corn to push prices down into the $4 range possibly lower. additionally world farmers are significantly increasing production of corn which will decrease our export market. Guess what prices will go down some more. Meanwhile the oil industry will reap big profits, our investment in a more flexible fuel supply will be wasted, DDG's will be hard to come by and farmers will be in trouble again with land price cashes and rural community problems. lets not crucify those that expanded production to meet demand(however created whether you agree on ho it was done or not). By the way I raise and feedout cattle and guess what I have made money throughout the ethanol expansion. I adjusted to the change. So the farmer takes it on the chin again for doing what the market is demanding only to have "special interests " with government pull stack the deck against us one more time.

VA  |  April, 11, 2013 at 01:35 PM

Having the government stop farmfare isn't exactly stacking the deck against us, it is returning to it's proper neutral role. I for one would be happy to have lower feed costs resulting from using feed for food, not fuel.

iowa  |  April, 11, 2013 at 07:25 PM

you most not know what co-products or DDG's are.

Dublin  |  April, 11, 2013 at 08:45 PM

Yo Samboy, if the by-products were worth much then the price of grain would not have sky rocketed!

Lowell, NE  |  April, 11, 2013 at 08:57 PM

Lee, if you had your head out of your ass you would realize that WDG are actually worth more than the corn itself on a pound for pound basis. Hence, the reason that they are costing us cattle feeders 100% the price of corn adjusted back to a dry matter basis. Cattle feeders in the corn belt have never had it so good. The benefits of the ethanol industry far outweigh the drawbacks. Those that cuss and deride the ethanol industry are only to lay the blame of their inadequacies on others......Hm, that sounds like a Democrat's behavior!!!

USA  |  April, 12, 2013 at 06:15 AM

Unfortunately, the article completely fails to incorporate info on the damage ethanol causes to engine components, which no doubt results in tens of millions of dollars in cost a year to business' and the public.

Bill Stanley    
Texas  |  April, 12, 2013 at 07:55 AM

In April 2012, the nationwide average price of gasoline (10% ethanol) was $3.89. E-85 (85% ethanol) was $4.90 when adjusted for the lower energy produced compared to gasoline. Liberals bash oil companies when the price of gasoline increases, but say nothing about even higher ethanol prices. newsandopinions dot net

VA  |  April, 12, 2013 at 08:00 AM

Kirk, Lee was actually correct. What you are not accounting for is that it takes more than a pound of corn to make a pound of DDG. We produce more grain than ever before and have fewer cattle by a wide margin. Even so, feed prices have gone sky high because so much less of the grain ends up being used for feed.

VA  |  April, 12, 2013 at 08:06 AM

Agreed. Next time the Feds try to foist another idiotic mandate on growers it should be fought tooth and nail. Nothing the government touches can succeed or be sustained in the end. I feel for those who adjusted, but it is simply unsustainable and nothing more than subsidized waste.

South Dakota  |  April, 16, 2013 at 09:20 AM

Where was the Grocery Manufacturers Association a few years ago when Kraft and Kellog's almost doubled the price of cheese and cereal because of high commodity prices and NEVER reduced their price back down when milk and wheat prices fell! Were they in front of legislators then? Who is keeping the profits from then till now?

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