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How to subscribeUSDA Defends Ethanol
According to the president’s Council of Economic Advisors, the total global increase in corn-based ethanol production accounts for only about three percent of the recent increase in global food prices.
That was the main summary point of a USDA press briefing held Monday in Washington DC to present their case for producing both food and fuel in the United States.
Presenting the data was USDA chief economist Dr. Joe Glauber, who pointed out all the factors that have contributed to higher food prices in the last year including economic growth, weather, export restrictions, higher food marketing and transportation costs, and finally, increases in biofuels.
Agriculture Secretary Ed Schafer said, “It’s clear that while bioenergy generation does have some effect on prices, it is not a major effect. It’s not even a big effect.”
Schafer said he had talked to the people who have “initiated these underground things that have been going on” to influence public opinion about ethanol incentives and found that while they understand that higher energy and transportation costs are the driving factor for increased food prices, they think “it’s easier” to target corn and ethanol.
“The change in the Renewable Fuels Standard, the change in the (ethanol) tariff or duty, isn’t going to effect food prices,” Schafer said. “We need to focus on things that will actually have an effect, instead of a short-term political solution we need to look long-term, because we have a long-term problem here.”
When asked directly if he was referring to the Grocery Manufacturers Association (GMA) campaign against ethanol that was revealed last week by the Capitol Hill publication Roll Call and publicized by Senator Charles Grassley (R-IA) and others, Schafer said yes.
“Clearly, we have a difference of opinion with GMA,” said Schafer. “They are a trade organization driven by their membership and evidently that is the course they chose to take, not one that I would take.”