N.C.B.A. criticizes plans to increase ethanol blend in fuel
April 01, 2009
by Bryan Salvage
WASHINGTON — Members of President Obama’s cabinet were sent a letter from the National Cattlemen’s Beef Association opposing an increase in the ethanol blend percentage for gasoline. The letter was sent to Steven Chu, Secretary of Energy; Tom Vilsack, Secretary of Agriculture; Lisa Jackson, Environmental Protection Agency Administrator; and Carol Browner, assistant to the President for Energy and Climate Change.
Set currently at 10%, the blend percentage is causing significantly more competition for corn and driving up feed costs for cattle producers, N.C.B.A. said.
Cattle producers urged them to oppose any administrative or legislative efforts to increase the amount of ethanol permitted to be blended with gasoline. And before the Administration or Congress proposes an increase in the ethanol blend percentage, a comprehensive assessment should address how such an increase will impact the market and if production will be able to accommodate a higher blend percentage, they added.
The letter iterated the current corn-based ethanol production is capped at 15 billion gallons, which is the equivalent of 10% of the U.S. projected gasoline market.
"Increasing the blend percentage to 15% would mean the immediate addition of 4.5 billion gallons of ethanol, and would require an extra 1.6 billion bushels of corn," the letter stated. "Based on 2008 yields, to reach this level, an additional 10.4 million acres of corn would need to be planted"
Corn ethanol production is significant to the cattle industry because of its impact on feed grain prices, the group stressed. Since January of 2008, cattle feeders have lost a record $4.3 billion in equity because of high feed costs. "The additional 1.6 billion bushels of additional corn needed for an E15 blend percentage is equivalent to the entire amount of corn the cattle industry utilizes in one year," the N.C.B.A. pointed out in its letter.
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