The Renewable Fuels Association says Big Food and Big Oil are on the defensive after losing in their bid for a waiver of the Renewable Fuel Standard. The National Council of Chain Restaurants has rolled out a campaign on the impact of the Renewable Fuel Standard on food prices with a study and a guest opinion piece in the Wall Street Journal. According to RFA – NCCR avoids any discussion of what really drives food prices in both. RFA President Bob Dinneen says every reasonable analysis of the factors influencing food prices has concluded that the cost of diesel fuel, gasoline and other energy inputs is the major driver. Dinneen says the RFS is working – with renewable fuels already displacing 10-percent of annual gasoline demand and dramatically lowering fuel costs for Americans.
Dinneen also points out that food prices are not advancing abnormally. According to USDA and the Department of Labor – annual food inflation in 2012 and 2013 will be right in line with the 20-year average. RFA notes food inflation rates since the RFS was adopted in 2005 have actually been lower on average than they were throughout the 1980s and early 1990s.
As for the analysis released by NCCR Wednesday – Dinneen says it’s important to mention no original analysis was conducted. Instead select studies were reviewed. He says it relied in part on a study by Farm Econ that is more than four years old and has been thoroughly debunked. When more recent studies were considered – the analysis found the RFS would increase corn prices by no more than four-percent in 2015 – which would have an almost indiscernible impact on consumer food prices. Dinneen says more recent peer-reviewed work that did not support the funder’s political position was ignored.
Growth Energy Responds to Flawed Study
Growth Energy CEO Tom Buis also responded to the study released by the National Council of Chain Restaurants Wednesday. Buis notes just 14-percent of the price of food is attributable to the cost of the commodity – with the rest attributed to energy costs and marketing. He says it takes a lot to bring food from the farm to the table – and the processing, packaging, wrapping, storage, refrigeration and transportation costs are all energy intensive. Buis says these groups distort the facts in order to justify higher profits – and ignore the fact that Americans pay the lowest per capita cost for food in the world. The renewable fuels industry – he says – is a win-win for America. Buis says the industry is creating jobs and revitalizing rural economies – as well as improving the environment and decreasing the nation’s dependence on foreign oil. At the same time – Buis says consumers are getting a choice and savings at the pump.
NCGA: Chain Restaurants’ Ethanol Report Full of Empty Calories
The following is a statement from National Corn Growers Association President Pam Johnson on a report released today by the National Council of Chain Restaurants attacking the Renewable Fuel Standard:
“A half-baked report from the lobbyists for chain restaurants does not serve up an accurate picture of ethanol’s impact when it comes to boosting jobs in rural America, lowering fuel prices or helping increase energy independence by expanding domestic, renewable fuel use in the United States. These are all points that make the Renewable Fuel Standard an important policy we need to protect and defend.
“The fact is, the NCCR study by PricewaterhouseCoopers was limited to only two possible scenarios. When the U.S. Environmental Protection Agency released its look at the RFS earlier this month, its researchers looked at 500 scenarios and made the right decision to reject an unnecessary waiver request. Eighty-nine percent of these 500 scenarios, according to the EPA, showed ‘no impacts from the RFS program at all’ when it comes to corn, food and fuel prices.
“Further, the study falsely states that more corn goes into ethanol than other uses. Its reliance on the general USDA categories without diving deeper ignored the fact that nearly twice as much corn is used for livestock feed than for ethanol. On such a complicated issue, it’s important to take a more comprehensive approach.”