Ethanol Industry Is Losing Clout

Washington DC October 11, 2007; The AIADA newsletter reported that the stalling ethanol industry wants Congress to mandate greater use of the biofuel. But many of the industry's former friends have turned against it amid soaring prices for corn and other grains.

According to the Wall Street Journal, ethanol production today is close to reaching the 7.5-billion-gallon level in the 2005 law. Oversupply has forced down prices and driven some ethanol producers into trouble. Producers and corn farmers are lobbying hard for Congress to boost the requirement anew to ensure that demand can soak up the rising production.

Opposition to the ethanol industry's goals has grown significantly stiffer. The so-called barnyard lobby -- representing the meat, livestock and poultry industries -- says high corn prices are hurting its profits. The price of corn-based animal feed has increased about 60% since 2005, according to the U.S. Department of Agriculture.

"Our single biggest priority is for Congress to reject a new renewable-fuels mandate," says Jesse Sevcik, vice president of legislative affairs at the American Meat Institute, a meat and poultry trade association.