Legislation reportedly being drafted that would change the Renewable Fuels Standard would be a bad policy move, according to the Renewable Fuels Association (RFA).
Reuters reported this week that a bill is being drafted in the House that would “reduce the federal mandate to use fuel ethanol when corn supplies are tight” in an effort to keep livestock feed prices lower, according to a congressional staff member. Rep. Bob Goodlatte (R-VA) and Rep. Jim Costa (D-CA) are named as likely sponsors of the legislation.
“Seeking to relegislate the RFS in this manner would do nothing to address the concerns raised by the livestock constituents of Reps. Goodlatee and Costa,” said RFA President and CEO Bob Dinneen. “Research clearly demonstrates that implementing an RFS waiver trigger based on the stocks-to-use ratio will not have the effects on corn prices desired by livestock and poultry interests, nor will it mean more corn is immediately available for feed use. Rather than knee-jerk policy reactions, Congress should maintain the integrity of the RFS to help drive job creation and wean America from its addiction to foreign oil.”
Dinneen also cautioned that if this effort were to be successful, the loss of ethanol in the fuel supply lead to increased prices at the pump. “In fact, given the disproportionate impact on food pricing exerted by energy and fuel prices, raising gas prices by reducing ethanol use would exacerbate concerns with rising food prices,” said Dinneen. “This is simply the wrong policy to address corn supply concerns.”