U.S. Senator Barbara A. Mikulski (D-Md.) announced today she and a bipartisan group of lawmakers led by Senators Kay Hagan (D-N.C.) and Saxby Chambliss (R-Ga.) sent a letter to Environmental Protection Agency (EPA) Administrator Lisa Jackson strongly urging her to use the agency's waiver authority to adjust the corn grain-ethanol mandate of the Renewable Fuel Standards (RFS). Currently the RFS requires over a third of U.S. gasoline supply to be made of ethanol. Senator Mikulski and her colleagues are calling on the EPA to adjust this mandate to reflect the current extreme drought and heat conditions. The adjustment will ease corn supply shortages and provide relief from high corn prices.
"Corn and poultry are two of Maryland's biggest industries deeply affected by the extreme weather this summer," Senator Mikulski said. "With the most severe heat streak in over 20 years upon us, we must act now to safeguard our farmers and our food security. I am calling on the EPA to take swift and efficient action to save our farming industry here in Maryland and across America."
As stressful weather conditions continue to push corn yields lower and prices higher, the farming industry and food security is in jeopardy. As one of the hottest summers in recorded history, the extreme drought has caused the price of corn to rise 50 percent in the last six weeks. As a result, the cost of animal feed, comprised mainly of corn, has increased. Ranchers and poultry farmers are forced to then shrink herds, cull flocks and sell their beef, pork, and poultry at an inflated price. Swift action to waive the ethanol mandate in RFS is necessary to halt these harmful effects.
The letter was also signed by U.S. Senators Mark Pryor (D-Ark.), John Boozman (R-Ark.), Ben Cardin (D-Md.), Johnny Isakson (R-Ga.), Christopher Coons (D-Del.), Kay Bailey Hutchison (R-Texas), Dianne Feinstein (D-Calif.), Jeff Sessions (R-Ala.), Thomas Carper (D-Del.), Richard Burr (R-N.C.), Lisa Murkowski (R-Alaska), Jim Webb (D-Va.), Tom Coburn (R-Okla.), Lindsey Graham (R-S.C.), Tom Udall (D-N.M.), John McCain (R-Ariz.), Mary Landrieu (D-La.), James Risch (D-Idaho), Jean Shaheen (D-N.H.), Mike Crapo (R-Idaho), Joe Manchin (D-W.Va.) and Roger Wicker (R- Miss.).
The text of the letter is as follows:
August 7, 2012
Administrator Lisa P. Jackson
U.S. Environmental Protection Agency
Room 300, Ariel Rios Building
1200 Pennsylvania Avenue, N.W.
Washington, D.C. 20460
Dear Administrator Jackson:
With record droughts across the continental United States causing corn supplies to shrink and prices to spike, we ask you to use your existing waiver authority to adjust the corn-ethanol mandate for the Renewable Fuels Standard.
As you know, the Renewable Fuels Standard (RFS) -- approved as part of the Energy Independence and Security Act of 2007 (EISA) -- increased the original RFS. It was designed to enable continued utilization of corn-based ethanol as next-generation biofuels developed and assumed an increasingly larger share of the total RFS. While we believe the RFS will stimulate advanced biofuels to commercialization, adjusting the corn grain-ethanol mandate of the RFS can offer some relief from tight corn supplies and high prices.
As part of EISA, the Congress included "safety valves" that enable the agency to adjust the RFS in the event of inadequate supplies or to prevent economic harm to the country, a region, or a state. Recent data from the United States Department of Agriculture (USDA) suggests the EPA should exercise its waiver authority for the conventional, corn grain-ethanol mandate.
Earlier this year, the USDA indicated that 72 percent of the U.S. corn crop was in good or excellent condition. However, because of persistent extreme heat and drought, the USDA recently rated only 23 percent of the crop as good to excellent and 50 percent as poor to very poor. USDA's July World Agricultural Supply and Demand Estimates (WASDE) report projects that 2012/13 U.S. corn yields would be 146 bushels per acre, 20 bushels less than two months ago.
As stressful weather conditions continue to push corn yields lower and prices upward, the economic ramifications for consumers, livestock and poultry producers, food manufacturers, and foodservice providers will become more severe. In fact, USDA recently announced that the drought gripping half the country will help push food prices above-normal food price inflation to 3 percent to 4 percent next year. Therefore, we ask you to adjust the corn grain-ethanol mandate of the RFS to reflect this natural disaster and these new market conditions. Doing so will help to ease supply concerns and provide relief from high corn prices.