Poultry, meat organizations call for ethanol production mandate waiver

Groups want waiver to stand for remainer of 2012, into 2013 due to drought

As U.S. drought conditions continue to be the worst in 56 years, and corn yield forecasts continue to drop significantly, a coalition of poultry and meat organizations have asked the U.S. Environmental Protection Agency to waive the federal mandate for the production of corn ethanol.

In a petition delivered to the agency, the coalition asked for a waiver “in whole or in substantial part” of the amount of renewable fuel that must be produced under the Renewable Fuels Standard for the remainder of 2012 and for the portion of 2013 that is one year from the time the waiver becomes effective. The Renewable Fuels Standard requires 13.2 billion gallons of corn-based ethanol to be produced in 2012 and 13.8 billion gallons in 2013, amounts that will use about 4.7 billion and 4.9 billion bushels, respectively, of the nation’s corn. Some agricultural forecasters now are estimating that just 11.8 billion bushels of corn will be harvested in 2012 — about 13 billion were harvested in 2011 — meaning corn-ethanol production will use about four of every 10 bushels.

The standard has “directly affected the supply and cost of feed in major agricultural sectors of this country, causing the type of economic harm that justifies issuance of an RFS waiver,” said the coalition in its petition. “[i]t is abundantly clear that sufficient harm is occurring now and that economic conditions affecting grain supplies and feed prices will worsen in the months ahead. Both conditions provide an independent basis for a waiver of the RFS.”

Relief from the Renewable Fuels Standard is extremely urgent, according to Michael Welch, president and CEO of Harrison Poultry and past National Chicken Council chairman. “This very short corn crop will undoubtedly prove to be devastating to the animal agriculture industry, food manufacturers, foodservice providers and consumers,” he said. “Thousands of jobs, a continued upward trend of rising food prices and the livelihoods of family farmers are all at risk. The chicken industry is urging the EPA to implement the law and promptly grant a full or partial waiver of the RFS. If not now, when?”

The National Corn Growers Association, however, said that it will continue to support the Renewable Fuels Standard. “The NCGA stands firm in its support of the Renewable Fuels Standard and will strongly oppose legislation to alter or repeal the RFS,” said National Corn Growers Association President Garry Niemeyer. “Likewise, we believe it is premature for a waiver of the RFS provisions at this point. With the crop still in the field, it is too early to determine this year’s final corn supply. In addition, the ethanol industry now has a significant surplus of ethanol and RFS  credits that can greatly offset ethanol’s impact on the corn supply.

“However, we recognize the severe impact of the drought on our farmers and our customers, here and abroad, with livestock, poultry, ethanol and other processing facilities, and we believe the flexibility of the RFS does work, and will work. NCGA also supports the waiver process that is embodied in the current RFS, and respects the right of those that may file a waiver petition to do so.”

Members of the coalition that signed the petition include the American Feed Industry Association, American Meat Institute, American Sheep Industries Association, California Dairy Campaign, Dairy Producers of New Mexico, Dairy Producers of Utah, Idaho Dairymen’s Association, Milk Producers Council, National Cattlemen’s Beef Association, National Chicken Council, National Pork Producers Council, National Turkey Federation, Nevada State Dairy Commission, North American Meat Association, Northwest Dairy Association, Oregon Dairy Farmers Association, Southeast Milk Inc., United Dairymen of Arizona and the Washington State Dairy Federation.