Industry groups applaud end of ethanol subsidy

by Meat&Poultry Staff
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WASHINGTON – As the end of taxpayer support for ethanol approaches, due to the expiration of the Volumetric Ethanol Excise Tax Credit (VEETC) on Dec. 31, industry and allied groups marked this deadline with relief as well as concern.

Geoff Moody, the Grocery Manufacturers Association’s director of energy and environmental policy, said GMA applauds Congress for allowing the ethanol tax credit and tariff to expire. “After more than 30 years and billions of dollars in taxpayer support, the corn ethanol industry is able to stand on its own without government support, and allowing these subsidies to sunset is an important first step toward a more rational fuels policy,” he added. “We look forward to working with Congress and the administration next year to reform other policies that divert food and feed into fuel.”

The US broiler chicken industry has been under economic pressure from the rising cost of feed grains, much of which is caused by the federal government’s ethanol policies. This is why the National Chicken Council welcomes the expiration of two of those policies – VEETC and the import tariff on foreign ethanol, according to Mike Brown, NCC president.

“Their sunset is a culmination of growing concern among the American public and on Capitol Hill, marked in June by overwhelming bipartisan and bicameral votes to end unnecessary federal support of corn-based ethanol,” Brown said. “These developments put the mature corn-based ethanol industry two steps closer to operating on a level playing field with other agriculture commodities whose largest input cost is corn. This is a victory for American taxpayers and the US Treasury, who are saving $6 billion in lost revenue, and a victory for US broiler chicken companies, who continue to struggle because of the artificially high price of corn.”

Joel Brandenberger, president of the National Turkey Federation, said NTF commends Congress for allowing the VEETC and import tariff on foreign ethanol to expire. “This advance is significant in reforming the current US biofuels policies, which has caused serious harm to the turkey industry,” he added. “The blender’s credit and import tariff on foreign ethanol distorted the corn market, creating needless volatility in the cost of animal feed. NTF and its members recognize that the battle to reform federal renewable fuels policy into something more sensible is far from over. The federation will continue to remain diligent to ensure the VEETC does not reappear and will continue to push for real reform of the Renewable Fuels Standard.”

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