A federal Environmental Protection Agency proposal to lower ethanol use in gasoline next year has upset grain farmers and drawn praise from oil and livestock producers.
The EPA wants to change the nation's Renewable Fuel Standards to lower the number of gallons of ethanol blended into gasoline supplies. Ethanol companies and grain farmers generally oppose the move on the grounds it would hurt the growth of alternative fuels.
It would reduce market demand for corn purchased to make the fuel, forcing already low corn prices even lower, said Tim Gerlach, executive director of the Minnesota Corn Growers Association.
"You've just made a proposal that might cut several hundred million bushels off the market," Gerlach said. "We're watching the price of corn, wondering what that will do over the next year."
But petroleum companies, environmental groups, and even some farm organizations like the plan.
The use of corn to make ethanol has raised grain prices and hurt farmers who buy corn to feed to their flocks, said Joel Brandenberger, president of the National Turkey Federation.
"The Renewable Fuels Standard effectively has cost our producers well over a billion dollars," Brandenberger said.
The EPA is taking comments on their plan, and will release a final ethanol decision sometime next year.