U.S. Livestock Producers Coalition Blasts Obama Mandate for Ethanol, Warns U.S. Has "1/3 Less of the Corn We Need"
November 24, 2012 • 10:57AM

The national coalition of livestock, poultry, and dairy organizations, which have sounded the alarm about short corn supplies and the need to lift the Federal mandate for corn-ethanol, blasted the refusal to do so by the Obama Administration. A week ago today, the Environmental Protection Agency announced they would not grant a waiver for the biofuels mandate, called the RFS, Renewable Fuels Standard.

The same day, the livestock producers coalition issued a statement saying, "We are extremely frustrated and discouraged that EPA chose to ignore the clear economic argument from tens of thousands of family farmers and livestock and poultry producers that the food-to-fuel policy is causing and will cause severe harm to regions in which those farmers and producers operate."

In coverage of this statment, by the National Pork Producers Council, a chief member of the coalition, the NPPC made the following points about the dire livestock and feed situation in the United States, in its Nov. 16 press release (see www.nppc.org):

In fact, dozens of poultry, pork, beef and dairy operations have filed for bankruptcy, been sold or simply gone out of business over the past several months because of rising feed grain prices.

"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?" the coalition asked. It is now abundantly clear that this law is broken, and we will explore remedies to fix it.

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

Further, the carry-over stocks for 2012-13 are now forecast at 647 million bushels, less than 5% of expected corn usage and the lowest amount ever. This is a 35% 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.

"We now have about one-third less of the corn that we need to adequately supply animal feed, ethanol, exports and sufficient carry-over levels," the coalition noted. But the government continues to mandate that a significant amount of the corn supply be blended next year into gasoline.

When Congress expanded the RFS in 2007, certain safety valves were added to the law. One provision allows the EPA administrator to reduce the required volume of renewable fuel in any year based on severe harm to the economy or environment of a state, a region or the United States.

In addition to the livestock, poultry and dairy organizations, a bipartisan group of 34 U.S. senators and 156 House members and nine governors petitioned EPA to grant a waiver of the federal requirement for the production of corn ethanol because the mandate, coupled with a drought that has reduced yields and pushed up prices of feed grains, has caused the severe economic harm for which Congress added safety valves.

"Unfortunately, EPA chose to ignore all of them by issuing a decision that is going to cost more American jobs, put family farmers and ranchers out of business, create an animal feed crisis and cause food costs to soar in the coming months," the coalition concluded.