Meat lobby wants corn-to-ethanol relief

WASHINGTON, July 30 (UPI) -- Livestock producers Monday called on the Obama administration to suspend ethanol requirements to prevent a spike in U.S. food prices due to the drought.

A coalition of beef, pork and poultry producers associations said the federal Renewable Fuels Standard mandated the use of a large chunk of the U.S. corn crop in gasoline at a time when corn prices have been on the upswing due to an ongoing drought in the Midwest.

"America's pork producers are extremely worried ... about having feed for their animals," Randy Spronk, president-elect of the National Pork Producers Council, said in a written statement. "Their anxiety is compounded knowing that the RFS requires corn ethanol to be produced no matter what. We're asking the EPA to give livestock and poultry producers and, ultimately, consumers a little help."

The NPPC and the other associations estimated the drought would reduce this year's crop to about 11.8 billion bushels compared to 14 billion last year. The RFS, they said, would divert four of every 10 bushels into ethanol production and likely push the cost of feed higher, which would no doubt raise meat prices down the road.

"I find it concerning to the viability of the livestock industry that these mandates are allowed to continue today in the worst drought I have seen in my lifetime," said J.D. Alexander, president of the National Cattlemen's Beef Association. "This isn't rocket science."

The ethanol industry fired back quickly with a statement contending the livestock industry would be in even tougher straights if not for ethanol since the fuel additive actually encourages farmers to plant more corn and provides them with a bit of a supply cushion in dry years.

"Just think, if we were taking the yield hit from this historic drought on 75 million acres instead of 95 million," said Monte Shaw, president of the Iowa Renewable Fuels Association. "There would be a much smaller corn harvest to allocate."

Shaw said the ethanol industry had been cutting back on corn consumption due to the drought and said the move to waive the RFS was actually a strategic step taken by livestock producers to cause corn prices to crater.