FAPRI Releases Analysis on RFS Waiver
New analysis from the Food and Agriculture Policy Research Institute suggests a full waiver of the conventional biofuel requirement in the Renewable Fuel Standard might reduce corn prices by just four-cents per bushel in 2012-13. That's one-half of one-percent. Further findings include that a waiver might only lead to a 1.3-percent - or 59-million bushel - reduction in corn use for ethanol and corn available for livestock might only increase by six-tenths of a percent. The analysis also concludes a waiver of the RFS would have no impact on retail beef prices next year - while retail pork prices might come down one-cent per pound. FAPRI wrote that waiving the RFS requirement during the 2012-13 corn marketing year would have limited market impact. They added that overall ethanol use and production are projected to be motivated mostly by crop and fuel market conditions in the marketing year - not the RFS. FAPRI analyzed the impacts of a full waiver of the RFS on corn prices, corn demand, ethanol output, imports, exports and numerous other agriculture and biofuel market factors.
Renewable Fuels Association President Bob Dinneen says this new study is the latest in a series of reports that show waiving the RFS would not have the types of impacts claimed by the livestock groups and grocery manufacturers. He calls the suggestion that a waiver would significantly lower feed prices and reduce retail meat prices absolutely absurd. According to Dinneen - the only real impacts of a waiver would be to discourage farmers from planting corn next spring and to interrupt and delay important investments in new feedstocks and advanced biofuels technologies.
[The full FAPRI report is available at: http://www.fapri.missouri.edu/outreach/publications
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