The National Corn Growers Association is voicing strong opposition to Texas Governor Rick Perry’s request for a waiver from the Renewable Fuels Standard.
“If granted, the waiver request made by Gov. Perry today will hurt, not help, U.S. consumers by increasing fuel costs and sending a signal to farmers to plant less grain,” said NCGA President Ron Litterer. “A waiver from the RFS would undoubtedly result in higher gasoline prices and it seems very improbable that grain prices or food prices would be reduced.”
NCGA points to a study released this week by the Center for Agriculture and Rural Development at Iowa State University which found that, “the growth in ethanol production has caused retail gasoline prices to be $0.29 to $0.40 per gallon lower than would otherwise have been the case.”
Given record global demand for corn, a waiver from the RFS would have little or no effect on grain prices for livestock and poultry feeders, Litterer said. Speculative investment in commodity futures markets, record demand for U.S. grain exports, heightened U.S. and global feed demand, and weaker than expected grain crops in Asia and Australia are among the other factors that must also be considered when looking at current grain prices.