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NFU Says RFS Benefits Farmers, Biofuels Industry

1 October 2012, at 10:42am

US - National Farmers Union (NFU) President Roger Johnson has submitted comments to the US Environmental Protection Agency (EPA) on a request to waive the Renewable Fuel Standard (RFS).

“The RFS reduces our nation’s dependence on foreign oil, creates jobs and stimulates our domestic economy, and its existing structure provides sufficient market flexibility to deal with a reduced corn crop,” said Mr Johnson.

“A possible RFS waiver is not only unnecessary, but most importantly would send strong negative signals to the nascent advanced biofuels industry. It would also jeopardise our nation’s energy security and the thousands of workers that depend on the industry."

In his statement, Roger Johnson countered arguments by RFS opponents that blame ethanol for high feed costs in the livestock sector by pointing to a recent Iowa State University analysis by Bruce Babcock that determined, in part, that eliminating the RFS would only reduce corn prices by less than five per cent.

“Ethanol production creates a valuable byproduct in the form of Dry Distillers Grains Solubles (DDGS). This highly nutritious byproduct is a major source of livestock feed, constituting the equivalent of one-third of the corn used in ethanol production, said Mr Johnson. “Since mid-June corn prices have climbed more than 50 per cent, so the ethanol industry has already responded by reducing its demand for corn by 15 per cent since the beginning of the year.”

“Waiving the RFS would also prove to have a negative effect on the economy,” Mr Johnson noted. “The US biofuel industry has become a cornerstone of the rural economy. It currently supports almost 500,000 American jobs and generates $53 billion in economic activity each year.”