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Introduction of the "Renewable Fuel Standards Elimination Act" and the "Renewable Fuel Standard Flexibility Act"

Floor Speech

Location: Washington, DC

* Mr. GOODLATTE. Mr. Speaker, it is past time for us to have a serious conversation about the federal government's role in supporting ethanol. One of the big drivers of ethanol is an artificial market, created by the federal government. The Renewable Fuel Standard, RFS, mandates that 36 billion gallons of renewable fuels be in our nation's fuel supply. This mandate is being fulfilled by grain ethanol that comes from corn.

* The federal government's creation of an artificial market for the ethanol industry has quite frankly created a chain reaction that is hurting consumers. It is expected that this year about 40 percent of the U.S. corn crop will be used for ethanol production. With increasing food and feed stocks being diverted into fuel, we are seeing diminished supplies for livestock and food producers. This year livestock and poultry producers will use 1.1 billion fewer bushels of corn than they used in the 2004/2005 crop year, the last crop year before the RFS. This will be the first year ever that ethanol production has used more of our corn supplies than feeding livestock and poultry in the U.S.

* The RFS mandate has created a domino effect. Tightening supplies are driving up the price of corn. The higher cost for corn is passed on to livestock and food producers. In turn, consumers see that price reflected in the price of food on the grocery store shelves. In the debate over ethanol, the government is picking winners and losers and livestock and food producers, and the consumers of livestock and food products are the losers. As we confront the reality of the tightening corn supplies, there are real concerns about having enough corn supplies to satisfy the RFS and the needs of our food producers. We should not be in a position where we are choosing between fuel and food. That is why I am introducing two bills that would alter this artificially created government market.

* The first bill, the Renewable Fuel Standard Elimination Act is simple; it would eliminate the RFS and make ethanol compete in a free market. The government should not be creating a market to sustain an entire industry. While I believe that we should completely eliminate the RFS, I recognize that there may not yet be the political will in Congress to completely eliminate this mandate. And while there may not yet be the political will to eliminate this mandate we have to address the reality that we are being confronted with, tightening corn supplies, and our livestock producers, our food manufacturers, and our consumers need relief now.

* That is why I have joined with several colleagues in introducing legislation to reform the RFS. This reform will provide relief to our livestock and food producers and consumers of these products. This legislation, the Renewable Fuel Standard Flexibility Act will link the amount of ethanol required for the RFS to the amount of the U.S. corn supplies. This legislation would provide a mechanism that when the USDA reports that U.S. corn supplies are tight, based upon the ratio of corn stocks to expected use, there would be a corresponding reduction of corn ethanol made to the RFS. For example, if this policy was in place now, the legislation would trigger a 25 percent reduction in the RFS. This is a common sense solution to make sure that we have enough corn supplies to meet all of our demands.

* I am a strong supporter of renewable fuels, when they compete fairly in the marketplace but the current policy is unfair and is causing unintended and negative consequences for American consumers, livestock farmers, and food manufacturers. Congress created this artificial market that is distorting the food and feed market, and we must provide relief of its unintended consequences. I urge the Congress to pass this legislation.

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