If Federal Ethanol Policy Is Threatened, How Serious Would It Be?

CattleNetwork.com
6/1/2009 8:24:00 AM

If you are playing the game Jeopardy! and the answer is “ethanol,” you might be tempted to respond, “What bio-fuel carries the most controversy?” Regardless of the turn that ethanol supporters make, there is always some roadblock to surmount. As Congress is faced with energy policy, food prices, and many other issues that ethanol touches, what are the economic impacts if any change is made from the status quo? Some are significant.

Several Members of Congress recently asked the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri for help in evaluating nearly a dozen alternatives that have been proposed as a result of oil, ethanol, and corn prices in 2007 and 2008. Along with the high corn prices, there was a considerable pain for the livestock producer, and some ethanol critics began asking why the subsidies and protective tariffs continued while prices were high. The FAPRI report examined a wide range of alternatives suggested by the Members of Congress, as well as from livestock groups.

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