Livestock farmers seek pause in ethanol production

Livestock farmers and ranchers seeing their feed costs rise because of the worst drought in a quarter-century are demanding that the Environmental Protection Agency waive production requirements for corn-based ethanol. The Obama administration sees no need for a waiver, siding with corn growers – many of them in presidential election battleground states Iowa and Ohio – who continue to support the mandate.

Author:
BMTN Staff
Updated:
Mar 8, 2018
Original:
Aug 9, 2012

Livestock farmers and ranchers seeing their feed costs rise because of the worst drought in a quarter-century are demanding that the Environmental Protection Agency waive production requirements for corn-based ethanol. The Obama administration sees no need for a waiver, siding with corn growers – many of them in presidential election battleground states Iowa and Ohio – who continue to support the mandate.

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The Central Minnesota Ethanol Co-Op has suspended operations until they can buy corn or sell ethanol at a better price, the St. Cloud Times reports. The Little Falls plant is using the downtime to complete maintenance and other projects, but most of the 30 employees are out of work.

Federal law requires that gasoline be blended with ethanol or other biofuels. About 40 percent of the nation's corn now goes toward ethanol production. But in a year when dry weather will mean less corn and higher prices, Minnesota's Chip Cravaack is among Congressmen urging that more of the crop be used as food.

Livestock farmers are demanding changes to the nation's ethanol policies. They say the fuel is taking up too much of the corn and that a grain shortage could cause meat prices to spike. Food producers also worry federal policies would exempt the ethanol industry from rationing during a shortage.

Biofuel Energy says it's closing its ethanol plant in Fairmont until the price of corn comes down. The drought that has ravaged the Midwest's corn crop has pushed up corn prices and erased the profit margins of ethanol producers. A plant in Little Falls shut its doors this summer.

There's no word on when an idled ethanol plant in Little Falls might reopen. But plant closings are becoming more common in an industry squeezed by drought-inflated corn prices. At least seven ethanol plants in the Midwest have closed and many others are operating at reduced capacity.

The 28th International Fuel Ethanol Workshop and Expo, the largest trade show for the country's ethanol producers, is taking place at the Minneapolis Convention Center this week. On Tuesday, the convention highlighted how the ethanol industry is faring since the expiration of a federal tax credit.

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