Ethanol Will Not Affect Food Prices, Grassroots Campaign Says

A press release from Ethanol Across America Tuesday states that the production of ethanol from corn will have little to no impact on food prices. It will, however, decrease fuel prices.

U.S. Senator E. Benjamin Nelson (D-NE), the Chairman of the Ethanol Across America campaign, says that any confusion on the issue is simply misinformation.

Senator Nelson said of the issue: "America's farmers are the most efficient and productive in the world. With this new demand will come increased yields and a likely leveling of prices. Even a recent study by critics of the corn ethanol industry concedes that the level of production we are calling for in Congress should not appreciably affect corn prices. We are also working hard to diversify our biofuel production by utilizing new feedstocks that range from specialty energy crops to waste materials."

In an Issue Brief, which the press release defines as a compilation of existing data and research, there are statistics that say that food costs have increased only 2% in the past year, less than the average of 2.9%. This is occurring even as corn prices have nearly doubled. The Issue Brief also said that during this time, petroleum price increases have had a huge impact because it is becoming more expensive to bring products to the market.

Douglas A. Durante, Director of the Ethanol Across America campaign, points out that although a survey conducted by the Nebraska Ethanol Board shows that fuel prices are extremely high in the state, various ethanol mixtures are significantly cheaper. "The petroleum industry can not have it both ways," Durante said. "They cannot continually blame high prices on tight fuel supplies, and then ignore the fact that ethanol adds to the fuel supply. After they take advantage of tax incentives they are making significant profits off of ethanol and as the Nebraska example illustrates, they can still offer ethanol at a lower cost."

Ethanol Across America's website calls themselves a grassroots information network, and that they are a "partnership between industry and government that is committed to advancing the production and use of renewable fuel ethanol by implementing a comprehensive education and outreach program."

The group promotes the creation of fuel from corn, forestry wastes, switchgrass, rice straw, and sugar cane, among others. Part of the idea is that the production of these items ends up creating both food and fuel, with minimal waste.

Research from the United States Department of Agriculture states that the energy returned from ethanol production is 1.34, meaning a yield of 34% energy.

Sources:

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/07-17-2007/0004627538&EDATE=

http://www.ethanolacrossamerica.net/who.html

http://www.transportation.anl.gov/pdfs/AF/265.pdf