Corn is a sacred crop for food companies, because without it there would be a whole lot less processed food and meat would probably get a whole lot more expensive. Corn-based ingredients like modified corn starch, maltodextrin, propylene glycol, glycerin, citric acid, xantham gum and, of course, high fructose corn syrup are the building blocks of products ranging from breakfast cereal and salad dressing to chicken nuggets and ice cream.
But the biggest chunk of corn grown in the U.S. -- and we're far and away the biggest producer -- goes into the feed that's given to cattle, pigs and chickens. This accounts for 42%, while ethanol represents the next biggest use, gobbling up 32%.
The food groups involved in the suit -- the Grocery Manufacturers Association, the American Meat Institute, the National Council of Chain Restaurants, the National Meat Association, the National Turkey Federation, the National Chicken Association, the National Pork Producers Council, the Snack Food Association and the American Frozen Food Institute -- are worried that increased demand for ethanol is going to result in higher corn prices, a natural fear since it's already happening. Corn prices are at a two-year high thanks to some combination of ethanol and projected lower yields.
The EPA's decision to allow E15 fuel in cars that were made after the 2006 model year delivers a crushing blow to food processors and the meat industry, both of whom devoted considerable effort to lobbying against this. The groups have also been trying in vain to hack away at ethanol's generous tax subsidies and import restrictions. The lawsuit, which was filed in the U.S. Court of Appeals for the District of Columbia, alleges that the EPA doesn't have the authority to issue the new rule.
"For those consumers worried about climbing food prices, this decision will increase the amount of corn being diverted to our gas tanks and away from meat and poultry production," said J. Patrick Boyle, CEO of the American Meat Institute.
Big Food is right to oppose Washington's blatantly political support for producing fuel from crops that could otherwise become food. According to Grist, the estimated 114 million tons of grain used to produce ethanol in 2009 in the US is the food supply for 370 million people at average world grain consumption levels.
But food companies have no ground to stand on when it comes to arguing against tax subsidies. Corn growers are the recipients of a $4 billion government subsidy boondoggle. Don't hold your breath waiting for the American Meat Institute or any other food group to call for an end to that.