The following opinion piece by NCC President Mike Brown ran in the May 23 edition of the Washington Examiner. The original article can be found here.
Memorial Day barbecues are about to become more expensive for Americans, thanks to a misguided federal policy that props up biofuel makers and corn farmers – at the expense of poultry producers and the customers who buy their chicken.
The price of corn feed is generally the most expensive part of raising chickens, making any policy that artificially inflates corn prices devastating to America’s poultry farmers and costly to consumers. The recent announcement by the Trump administration that it will permit the year-round sale of E15 (gasoline blended with up to 15 percent ethanol) will create just that kind of price inflation.
Currently, these high-ethanol fuels are only sold in colder months because heat increases the human health risks from ozone, of which ethanol produces substantial amounts when burned. Not much E15 is sold at all, however, because it also has adverse effects on small engines, from mowers to chain saws, and it can’t be used in older cars.
Not only does this new policy ignore those risks to engines and health, but it is also one more cost heaped onto American chicken farmers by the misguided 2007 Renewable Fuel Standard, an outdated, environmentally ineffective, and expensive policy that acts as a multibillion-dollar subsidy for corn growers, paid for by American consumers.
This new announcement has strangely been cast as a “win-win,” giving ethanol producers E15 and giving small refiners waivers to escape the law’s worst impacts. But there are more than two parties impacted by the RFS, and America’s collective poultry, livestock, and meat sector has been completely left out of the bargain. What we need is a “trifecta” solution that considers animal agriculture.
More corn diverted into gas tanks means less available for food and animal feed, and higher food prices passed down to consumers. While the American public will bear significant costs from this contentious “compromise” between oil refiners and biofuel proponents, ranchers, poultry producers, meat packers, and others will face their own challenges.
The RFS has endured as a zombie law — widely disliked, outdated, costly, and inefficient. Yet, it has limped along for more than a decade as it hands out subsidies to an important political constituency. It is steadily growing more expensive and more detached from its original good intentions.
The ethanol mandate has ultimately created a vicious cycle in which small chicken producers are driven out of business, leading to shorter supplies of chicken, which leads to higher prices for consumers at the grocery store. Since the RFS was passed in 2007, chicken companies have faced $62.5 billion in higher actual feed costs, based on a 2006 baseline, and more than a dozen major producers have ceased operations.
In the meantime, ethanol mandates set by the EPA have increased from 5 billion to 16 billion gallons per year with no discernable impact on energy security, all the while ignoring the cries for help from America’s poultry farmers.
At the time the RFS was adopted, the chicken industry was led to believe that the RFS included a workable “off ramp” that would reduce mandates in times of economic crisis. That belief has proven to be very naive.
Since 1975, total chicken production has increased every year – even during severe corn price disruptions prior to the RFS – except for two years: 2009 and 2012. Both were years in which the EPA increased ethanol mandates under the RFS and ignored the consequences for poultry farmers.
All of this might be justifiable if the RFS had tangible benefits, but numerous studies have found that corn ethanol has virtually no impact on greenhouse gas emissions. It also reduces fuel economy and leads to devastating habitat loss for endangered and threatened species.
Skyrocketing demand for corn has caused the conversion of American forest, grassland, and critically endangered prairie into corn fields, leading to the release of 115 million additional metric tons of global carbon from 2008-2015 alone, according to a study from the University of Wisconsin-Madison.
Dozens of environmental groups, hunger charities, oil companies, academics, and farm groups have spoken out against this wasteful policy, yet their complaints are being answered by a policy that will push more corn ethanol into the market, not less.
This policy will only continue the damaging impacts of the RFS, driving more small family farmers and ranchers out of business, creating an animal feed crisis, and causing food costs to soar. The chicken industry is just one flood, freeze, or drought away from another crisis like those of 2008-09 and 2012. If oil refineries deserve protection from the damaging impacts of the RFS, poultry producers do as well.
Now is the time to adopt a statutory, transparent, and predictable off ramp when corn inventories are low, and to consider a gradual and complete phase-out of this outdated, broken mandate. America’s chicken farmers call on Trump to stand up to Big Ethanol and do just that.
Michael J. Brown is president of the National Chicken Council.
