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Iowa defending RFS

By Staff | Jan 21, 2014

JOHNSTON – Iowa corn growers, who are also leaders in the corn industry, urged anyone who has been positively affected by the development of ethanol industry to make their voices heard.

At issue is Tuesday’s deadline for citizens to file written comments supporting or opposing the U.S. Environmental Protection Agency’s proposal to cut the required volume of blending ethanol into gasoline during 2014. The proposal, if enacted, would cut the requirement from 16.5 billion gallons to 15.2 billion, a fact that many are saying would be harmful to farmers, ag bankers, ag retailers and fuel consumers.

Roger Zylstra, a Lynnville-area grower and president of the Iowa Corn Growers Association, was joined in a Tuesday morning teleconference call with Iowa reporters by Mark Recker, an Arlington-area producer and chairman of ICGA’s Iowa Corn Usage and Production Committee.

Online comments can be filed with the EPA through the ICGA’s website iowacorn.org.

Written comments can be mailed to EPA, Mail code 2822T, Air and Radiation Docket, ID No. EPA-HQ-OAR-2013-0479, 1200 Pennsylvania Ave. NW, Washington, D.C. 20460.

“We have studies that are telling us that if we drop the ethanol usage by as much as is proposed,” Zylstra told reporters, “it would cost us 19 cents (per bushel).

“That certainly puts us below the cost of production and makes it difficult to continue in agriculture.”

Recker said, “Nothing has impacted my business more than the ethanol industry has. It’s created a lot of opportunities in my neck of the woods, a chance for our kids to come back and farm, made farming more profitable and more enjoyable and less reliant on farm programs.

“All that is at risk with the reduction of volumes as I see it. We’ll be below the cost of production and that’s why we need to rally the troops and get these rules changed.”

When asked if the ethanol industry would exist if petroleum companies were not required to oxygenate gasoline with it, Zylstra said, “There is a market demand for ethanol.

“But the battle is to get beyond the 10 percent blend. The economic and environmental impacts are much greater for us.

“The oil industry is intent to not put the infrastructure in place to use higher blends of ethanol. So we think it’s going to take more insistence by growers and the government to allow more blends into the marketplace.”

Ethanol was mandated as the U.S. oxygenate of choice in the 1990s when it banned methyl tertiary butyl ether, a proven carcinogen and pollutant.

“Ethanol has been a successful replacement for that,” Recker said. “It’s been beneficial to the automobile industry for use in engines.

“When ethanol is priced like it is, it’s good for consumers because it brings down the price of gas at the pump.

“So for us to move from E10 to E15 only makes sense.”

Craig Floss, ICGA chief executive officer, joined the discussion saying the corn lobby is working with EPA to approve a waiver allowing E15 to be sold year-around.

To date, EPA has not allowed the waiver. Without it E15 will be unavailable from June 15 to Sept. 15.

“So that’s holding back retailers from wanting to offer it,” Floss said. But, “last week, MAPCO Express Inc., based in Tennessee, announced it will install E15 at 100 of its 300 chain stores in 2014.

“Retailers are seeing the advantage where they can sell it year-round, because it is competitive, offering consumers a slightly lower-priced product.”

Study commissioned

Zylstra said the corn industry has commissioned a study by Informa “That we think will show there’s certainly a lot of opportunities to move beyond the mythical E10 blend wall.

“We’re counting on the fact that if we get enough comments and enough science to persuade the EPA that this doesn’t make sense for America, farmers and business people – it’s just something they’ll have to change back to the way it was originally put in place.”

Recker said the key is “an overwhelming number of comments. We feel we have the facts on our side.

Floss referenced a Louisiana State University study that determined if EPA changes the volume requirement the change will increase the price of gasoline by five cents per gallon.

“The last thing the Administration wants to do is raise the price of gas on consumers,” Floss said. “It stands to reason that if ethanol costs less to put into the fuel supply than gasoline, why would we want less of it in the supply?”

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