Senate GOP Wants Halt To Ethanol Expansion

(AP)  Senate Republicans on Monday asked environmental regulators to use their power to halt the country's ethanol output expansion plans amid rising food prices.

Twenty-four Republican senators, including presidential candidate Sen. John McCain of Arizona, sent a letter to the Environmental Protection Agency suggesting it waive, or restructure, rules that require a five-fold increase in ethanol production over the next 15 years.

Congress passed a law last year mandating a ramp-up to 15 billion gallons of corn ethanol by 2015 and 36 billion by 2022. But McCain and other Republicans said those rules should be waived to put more corn back into the food supply for livestock, and to encourage farmers to plant other crops.

"This subsidized (ethanol) program - paid for by taxpayer dollars - has contributed to pain at the cash register, at the dining room table, and a devastating food crisis throughout the world," said McCain, in a statement.

Despite tough rhetoric from lawmakers, analysts say Congress is unlikely to roll back such a popular program during an election year.

Friedman, Billings, Ramsey & Co. analyst Kevin Book argued in a recent note to clients that Congress will not "turn on the corn belt" because of the significant number of votes held by ethanol-producing states. Ethanol subsidies could face greater risks, however, in 2009 and going forward, according to Book.

Republican Sen. Charles Grassley of Iowa said Monday "ethanol is unfairly taking the brunt of the criticism" for escalating food prices. Grassley's home state is expected to produce a quarter of all U.S. ethanol this year.

Farmers have responded to federal ethanol incentives by planting the largest crop of corn in 60 years, leaving fewer acres for soybeans, oats and other agricultural staples.

Tighter crop supplies means higher production costs for food processors of all types. In one recent example Pilgrim's Pride Corp., the nation's largest chicken producer, said costs rose $200 million in the quarter on higher corn and soybean feed.

And Americans are paying those higher costs at the grocery store, where egg prices have jumped 40 percent in the last year and flour prices have risen 50 percent since January, raising the price of bread and other baked goods.

The EPA has the power to waive or restructure the requirements if they cause unintended harm to consumers or the environment.

"We don't think it's the right move to make," said Liz Friedlander, a spokeswoman for the National Farmers Union.

The group has defended corn-based production of the alternative fuel, saying its impact on the rising food prices has been relatively small. Instead, it says food price inflation is mainly due to higher fuel prices, poor weather conditions and dwindling stockpiles of wheat and other crops.

The ethanol industry said Monday altering the biofuels mandate "would drive the price of oil and gasoline through the roof," according to Matt Hartwig, a spokesman for the Renewable Fuels Association.

Ethanol is "one of the only solutions for holding down the price of oil in the long-term," according to Jeff Broin, president and chief executive of Sioux Falls, S.D.-based Poet, the nation's largest ethanol producer.

While nearly all experts agree increased biofuel production by companies such as Archer Daniels Midland Co. and Pacific Ethanol Inc. has contributed to the run-up in food prices, there is little consensus on the scope of its role.

The ethanol industry says ethanol and other biofuels account for just 4 percent of the price surge, while the Department of Agriculture says the figure is closer to 20 percent.

Last week a group of international scientists recommended halting use of crops for biofuel, saying it would cut corn prices 20 percent.

Shares of VeraSun Energy Corp. fell 41 cents, or 5.9 percent, Monday to $6.50 in morning trading. Shares of Archer Daniels Midland Co. rose 34 cents to $44.32. Pacific Ethanol shares rose 7 cents, or 2 percent, to $3.55.

[neobrian-2009]

Big Oil,Greedy Oil Perverts,...Get a Life
These crops are mostly INedible ,..(For You Brain-dead Re-Cons,this Means You should not eat them )
Leaves,Stalks,canes,stubble,peelings,rinds,,etc,..And it`s Renewable !!!
McCant is Only a cheap replica of Your W orst resident to Ever Occupy the White House,..However,He could be just as bad very quickly given the chance,..
Let him drink Bush Lite with Cindy McHooters and let Our Country return to it`s rightful owners,The People,NOT the Criminal CEO`s of the Re-Con sect !

[downsteamjim]

Choice drill in Anwar, offshore etc.; build nuclear power etc. or let poor people starve. The environmentalist choice is simple. When people starve their carbon foot print is erased. Imagine a poor caribou having to walk under a pipeline. The horror!

[rf35]

LibH8er, any chance you can express yourself without resorting to abusive language and disguised profanity? Even the moderates here are getting tired of it.

[libh8er]

Another lib democrat ''do-good'' government mandate takes a turn for the worse. When will republicans EVER LEARN? You cannot go along with environmentalist controlled lib democrat ideas....you''ll screw yourselves and the country, everytime!!!!

[panhandlpete]

All this noise about a world food shortage....why? If we sent equipment, tractors, and seeds to those places where food supplies were short, and let those folks work for themselves for self supporting goals. But "no", that would mean our gov''t could not manipulate, nor could their gov''t steal the funds.

Look beyond the rhetoric that gets out to the media....these REPUBS do not care about world food shortages.....they only want to hold on to the REINS of POWER and are desperately grasping at ANY possible method to do it.

Why won''t this EPA lend support to programs to cover the desert with solar panels? Now it would change the visual appearance of the landscape, but has the potential for supplying solar generated electricity for decades to come? Just think what ALL THE MONEY SPENT ON THIS FAR EAST SHAM (Iraq et al) could do for the future needs of this country!!!!

[dog7771]

HEMP IS THE ANSWER, DUMBAXXES. NO MORE BLOOD FOR OIL!

[rf35]

Ethanol is NOT a solution to anything. I do agree in altering our food export practices, though. We also need to put this ethanol idea where it belongs...in the grave. Ethanol is an ecological nightmare. Of course the Repubs are against it, but not for the noble reasons one might hope for. They''re hoping to keep us addicted to oil. Yes, halt ethanol expansion, but replace it with hydrogen fuel cell refinement, not more gasoline use. We have the technology, we just need to bring down the cost and build the infrastructure. Of couse, if gas prices continue their climb, HFC power may become an equally priced alternative.

gopack443, check Clinton''s web site. She has a plan to begin troop withdrawal within her first days in office. Obama is clueless and McCain wants to stay until the oil runs out.

[armydog2]

the republicans are owned by the big oil companies, of course they want to stop alternative fuels.

[gopack443]

there is no one solution to the energy problem but lots of small solutions. We need to combine different sources of energy and different ways of using less. Only then will we be less dependent on foreign oil and the need to protect it at any cost. it will take time but will happen.
In the mean time the biggest reason for the higher cost of food is high oil prices and the biggest factor in rising oil prices are instability in the middle east and we all know the biggest factor in that regard at this time is bush''s war and there is no good way out of that. There has never been a exit strategy and I sure haven''t heard one from any of the 3 main yahoo''s running for president this time either.

[deacon20081]

Interesting that Mc Joke and company are trying to save face with the electorate by supposedly doing something "good". They and Bush/Cheney created the ethanol mess to garner votes from Farmers in the first place. What a joke.