Washington, DC – U.S. Senator Ben Cardin (D-MD) has introduced a bill that would link the corn ethanol production mandate under the Renewable Fuel Standards (RFS) to the amount of U.S. corn supplies. S. 3428 creates a simple process so that when the U.S. Department of Agriculture (USDA) reports on U.S. corn supplies towards the end of each year, based upon the ratio of corn stocks-to-expected use, there could be a reduction made to the RFS mandate for corn ethanol.
“Domestic food production is reaching a state of crisis driven by the increasing cost of inputs, like corn, so that poultry and other food producers have to compete with industries that are operating under unfair government ethanol production mandates. My legislation offers a simple change to the Renewable Fuel Standard that will help provide our domestic food producers access to corn,” said Senator Cardin. “This is a common sense solution to make sure that we have enough corn supplies to meet all of our corn demands.
“I understand the important role domestic ethanol production will play in helping our nation achieve greater energy security. However, the nurturing and growth of our domestic biofuels industry must not come at the expense of our domestic food supply. We cannot sacrifice U.S. food security for energy security,” Senator Cardin added.
S. 3428 – The RFS Flexibility Act:
Assuring Fairer Access and Fairer Prices for Corn for U.S. Food Producers and U.S. Consumers
Innovations in science and technology have created astounding new uses for corn. These new uses have increased demand for this commodity for uses ranging from traditional purposes like animal feed, food sweeteners and food additives to new uses in plastics and motor fuel. This growing demand for U.S. corn has resulted in record high corn prices. While market demand for corn is genuinely high, there are also government mandates and market supports for specific corn based products that inflate the demand for corn in certain sectors – namely ethanol. These government supports for certain corn based products have come at the expense of other corn users like livestock growers and food producers.
This legislation will alter the Renewable Fuels Standard (RFS) to give relief to livestock and food producers and consumers of these products. It is a common sense solution to make sure that we have enough corn supplies to meet all of our demands.
Stocks to Use Determination
Once a year, the Administrator of the Environmental Protection Agency will review the current corn crop year’s ratio of U.S. corn stocks-to-use ratio in making a determination of the RFS.
By the end of November the Administrator of the Environmental Protection Agency will make an official determination of the Renewable Fuels Standard (RFS) corn ethanol mandate for the following calendar year, based on the U.S. Department of Agriculture’s November World Agricultural Supply and Demand Estimate report to determine the U.S. corn stocks-to-use ratio. The Administrator shall provide for a waiver for the RFS for the following calendar year according to the calculated stocks to use ratio as directed. Such a waiver, if required, shall be included in the Environmental Protection Agency’s Federal Register notice regarding the RFS for the following calendar year. The required waiver, if any, will take effect January 1 of the new calendar year.
Stocks-to-Use Ratio Waiver to the Renewable
——– Percent ——- Renewable Fuels Standard for Corn Ethanol
Above 10.00 no adjustment
10.00 to 7.50 10 percent reduction
7.49 to 6.00 15 percent reduction
5.99 to 5.00 25 percent reduction
Below 5.00 50 percent reduction
Corn Grown for Ethanol Production Must Not Contribute to Environmental Degradation
U.S. crop support programs have a long tradition of requiring benefit recipients to apply basic conservation measures on their farming operations to qualify for benefits. Corn growers have benefitted enormously from the RFs corn ethanol production mandate. The legislation assures that that management of nutrient pollution from corn grown for ethanol is properly managed. The legislation requires corn ethanol credit generators to certify that the corn producer that supplied the feedstock is employing nutrient management practices on their operation to control nutrient loss to the environment. These nutrient management practices would be based on practices that USDA Natural Resource Conservation Service advises farmers to use to manage nutrient pollution.