CongressDaily reports that Senator Hutchison (R-TX) introduced a bill (S. 3031) today that would place a freeze on federal ethanol production mandates at this year’s levels. The bill is currently co-sponsored by ten Republican members including the party’s presumptive nominee for president, Senator McCain (R-AZ).
Some background on the bill is given below per this press release:
U.S. Senator Kay Bailey Hutchison (R-TX), Chairman of the Republican Policy Committee, today filed S. 3031, legislation to freeze the corn-based ethanol mandate at this year’s level. Legislation passed last year requires an annual increase in the amount of ethanol produced domestically, from 4.7 billion gallons in 2007, to nine billion this year and increasing to 15 billion in 2015. According to commodity price reports, since February 2006 the combined increase in the price of corn, wheat, and soybeans is over 416%.
Senator Hutchison’s bill would freeze the ethanol mandate at this year’s level which is 9 billion gallons. CongressDaily notes that ethanol production is supported by a powerful group of Midwest members of Congress.
Included in that group is Senator Grassley (R-IA), ranking member of the Senate Finance Committee, who last week strongly criticized those blaming ethanol production for the increase in food prices. “The problem is none of these criticisms are based on sound science, sound economics, or for that matter even common sense,” he stated in a floor speech.
Additionally, Agriculture Secretary Ed Schafer spoke today in support of ethanol production. He believes that increasing demand from other counties, a recent drought in Australia and rising energy / fuel prices are the main reasons for higher food prices and not ethanol production.
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