Industry groups applaud RFS reform effort
WASHINGTON – Groups representing various segments of the food industry rallied around a new bill submitted to the US House of Representatives that would significantly reduce the role of corn in ethanol production.
The Renewable Fuel Standard Reform Act would prohibit corn-based ethanol from being used to meet the RFS and reduces the total size of the RFS by 42 percent over the next nine years. The bill also limits the RFS to using only renewable biomass and other advanced biofuels. US Reps. Bob Goodlatte, Jim Costa, Peter Welch and Steve Womack introduced the legislation.
“I commend Congressmen Goodlatte, Costa, Womack and Welch for their leadership in introducing this legislation that will provide much needed relief to US chicken producers and family farms that raise chickens,” said Mike Brown, president of the National Chicken Council, in a statement. “After EPA's refusal last fall to grant a waiver from the RFS in the face of the worst drought since the 1950s, it is abundantly clear the RFS is broken and needs to be reformed.”
Stakeholders in the biofuels industry were critical of the bill. Brooke Coleman, executive director of the Advanced Ethanol Council, said the bill was "a smokescreen" for going after corn-based biofuels and the RFS, which "has fundamentally disrupted oil industry control of the marketplace while saving consumers money at the pump.”
“Congressman Goodlatte gets points for being creative,” Coleman said. “Disguised as a reform effort supportive of advanced biofuels, the RFS Reform Act actually guts the RFS by eliminating key provisions that require oil companies to actually change their behavior and buy renewable fuels.
“It is not a coincidence that the American Petroleum Institute (API) has been asking for these modifications to the RFS for years. But the RFS Reform Act is even more disingenuous than that. While stating that he merely wants ethanol to compete in a free market, in the same breath Congressman Goodlatte proposes to ban ethanol from 90 percent of the market. If there ever was a definition of free market fit for the oil industry, this is it.”
In November, The US Environmental Protection Agency (EPA) denied a request by industry stakeholders to impose a RFS waiver because suspending the RFS would reduce corn prices by only 1 percent. Brown said that chicken producers have incurred $35 billion in cumulative additional feed costs since the RFS was enacted. He said some poultry companies have gone bankrupt, sold out or simply shut down.
“Chicken producers are certainly not anti-corn; and we're not even anti-ethanol,” Brown said. “What we are against is a government mandate that artificially inflates the price of corn, picks winners and punishes losers among those who depend on it.”
“The Renewable Fuel Standard Reform Act seeks to level this playing field by embracing free market principles,” Brown concluded.
“Food costs are a top business challenge for the restaurant industry, which operates on razor-thin margins,” said Scott DeFife, executive vice president of Policy and Government Affairs, National Restaurant Association. “The Renewable Fuel Standard Reform Act would benefit consumers, businesses and the overall economy by helping to lower these costs, and we applaud Congressmen Goodlatte, Costa, Womack and Welch for seeking needed reforms to the RFS.”
The National Cattlemen's Beef Association and the National Pork Producers Council urged Congress to reform the biofuels mandate.
“Cattlemen and women are self-reliant, but in order to maintain that we cannot be asked to compete with federal mandates like the Renewable Fuels Standard for the limited supply of feed grains,” said Craig Uden, NCBA Policy vice chairman, and an Elwood, Neb., cattle feeder. “In light of the worst drought to hit our country in over 50 years and the ever increasing renewable mandates, we are seeing many of our members not only failing to profit, but taking a loss.”