Posted on: July 31, 2012 in Corn prices, Ethanol, Environment

July 30. 2012

To the Editor:

The July 30^th editorial “Food and The Drought” is more hypocritical, hysterical, hype than reasoned fact and sound thought.  This drought is undoubtedly painful.  The ethanol industry is feeling that pain as well as farmers and livestock producers.  In fact, since this drought began, the ethanol industry has reduced its corn consumption by more than 13%.  You see, the market, not the government, is the best mechanism to ration demand.  We will not know the impact of this drought on corn supply until harvest.  In the meanwhile, perhaps you could avoid speculation and let the marketplace work.

Your editorial compels me to clean up a few overlooked or entirely incorrect statements.  First, ethanol is no longer subsidized and there is NO tariff preventing imports.  Second, ethanol producers will not utilize “40% of the crop this year.”  The Tribune should know that only the starch is used in ethanol production, leaving a high value, high protein, low cost feed product for livestock to use.  Without ethanol’s feed supply, costs are quite likely to increase at feedlots. 

Waiving the RFS will only reward oil companies that have long sought to repeal or undermine this important program that has reduced our dependence on imported oil from 60% to 45% and saved consumers money at the pump.  Moreover, the ethanol industry today is responsible for more than 400,000 jobs and has revitalized rural communities across the country. 

We understand the concern Americans feel about the effects of this drought, we are after all an industry built by farmers.  But let’s call a spade a spade.  When 3% of the net global grain supply is used for fuel, there is and will be grain for food.  This country is built on the power of the free market.  Let it work.  It is the best mechanism for rationing demand, not tampering with long term, strategic government policies as a means of preserving subsidized corn for corporate livestock producers.  This topic is too serious and real for scare tactics and hype.

Sincerely,

Bob Dinneen
President and CEO
Renewable Fuels Association

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