RENEWABLE FUELS STANDARD WAIVER WILL HAVE HUGE EFFECTS

If you are a follower of current events, you have no doubt seen that five state governors, at the prompting of the U.S. livestock industry, have asked for a waiver to the Renewable Fuels Standard (RFS).

In layman’s terms, the livestock industry, and subsequently the governors of Arkansas, Delaware, Georgia, Maryland, and North Carolina, has asked the EPA to consider lifting the requirement that Americans use increasing amounts of biofuels in the place of petroleum.  They did this because producing biofuels to fulfill the requirements set forth in the RFS takes corn, and the livestock industry is competing with the ethanol industry for corn which is in shorter supply than usual because of the drought.

Last week, the EPA said that they would delay the decision on the waiver until mid-November, after the elections.

The waiver request and granting of the waiver is an issue that IL Corn has our eye on, although we don’t really have a position.  We don’t want the waiver to be granted because we end up losing potential market share if the ethanol industry is throttled back, but we also want the RFS policy to work and if there ever is a year when corn is in short supply, 2012 is it.  We are relying on the EPA to make the best decision for the American public and the agricultural industry, but will be affected no matter which direction this falls.

According to Larry Elworth, chief agriculture counselor to EPA Administrator Lisa Jackson, no matter which way EPA goes in the fuel waiver debate, Elworth said, “We will be litigated.”  Obviously, the decision heavily affects everyone.

Stay tuned for the answer to this question shortly after we find out who will serve us as President for the next four years.  And if you have a significant interest in this issue, consider submitting comments to the EPA regarding your position.  Comments are due by October 11.

Dave Loos
ICGA/ICMB Ethanol Guru

IL CORN ADDRESSES NUTRIENT RUNOFF

If you are a regular follower of Corn Corps, you might remember this post which details the difference between a membership organization and a checkoff association, between the Illinois Corn Growers Association and the Illinois Corn Marketing Board. If you don’t remember this post or haven’t read it, go read it now.

You might also need a better understanding of “nutrient runoff” if you aren’t from an agricultural background or profession. Nutrient runoff describes the fertilizers we put on our fields that are left unused by the plants being collected in the water supply and leaving the field into our streams and rivers. We address nitrogen and phosphorus as the key nutrients that get carried into streams and rivers. Even your own yard, if you fertilize it, can contribute to nutrient runoff into our water supply.

Using the model of a checkoff program, Illinois has now formed the Nutrient Research and Education Council or NREC. NREC replaces an older group, FREC (Fertilizer Research and Education Council), with some significant changes. FREC was managed entirely by the State of Illinois and its funding, intended for nutrient research and education, has been swept by an Illinois government that can’t pay its bills. The new NREC is a public-private partnership, much like the checkoff fund, where the monies collected are held outside of the state coffers so that they can actually be used for nutrient research and education.

Nutrient research and education IS needed. The USEPA considers Illinois agriculture a major contributor of nutrients resulting in Gulf Hypoxia as well as unacceptable levels of nitrogen and phosphate in some Illinois streams, rivers and lakes. Research and education to relieve or disprove these opinions is critical to avoid regulations that would harm farmer profitability, but more importantly, jeopardize world food supplies.

The new NREC is a $1 per ton assessment on all fertilizer sold. The Illinois Department of Agriculture will receive 25 cents of the assessment for fertilizer quality, safety, and inspections while the remaining 75 cents will go into research and education to deal with the nitrogen and phosphorus runoff issues while increasing yields.

The bottom line is, Illinois farmers and fertilizer dealers want to do the right thing for the environment. They’ve tried to do the right thing in the past, but our state budget didn’t allow for our programming to work most efficiently. Now, we have taken matters into our own hands, passed legislation to create NREC, and continue to address the environmental issues that may be caused by Illinois agriculture.

It’s a big issue for Illinois Corn, one that we consider very important, and we look forward to big results.

Phil Thornton
ICGA/ICMB Value-Added Director