Monday, June 20, 2011
Weekly News Highlights
Volatile Times — Conflict makes news and in the business of agriculture, there has been no shortage of conflict. With tight grain stocks and a slow start to the 2011 growing season, the markets are consistently chaotic. The Red River Farm Network is also seeing that level of pandemonium in Washington, DC. For the US Senate, attitudes about ethanol appear to be shifting and government support for the renewable fuel is on shaky ground. In the House, agriculture spending was in the cross-hairs during the debate over agricultural appropriations last week. The Red River Farm Network is committed to delivering the news impacting your business, complete with market and farm policy analysis.
Ethanol Takes a Hit — Two days after the Senate rejected an attempt to eliminate the ethanol tax incentive, the Upper Chamber reversed itself. With a 73 to 27 vote, lawmakers decided to end the 45-cent-per-gallon blender’s tax credit and the 54-cent-per-gallon tariff on imported ethanol. New Jersey Senator Robert Menendez was in the majority, saying the federal government delivers unprecedented support to the ethanol industry. In addition, Menendez says billions of dollars are also spent to subsidize corn production. “So, in a time of fiscal constraint, we simply cannot afford to prop up an industry with such enormous supports, and these supports are not just costing taxpayers money, but they are also causing food prices to rise and harming our environment.” South Dakota Senator John Thune argued his colleagues singled out the ethanol industry, punishing it by changing the rules in the middle of the game. In practical terms, Thune said the Senate vote was largely symbolic. “It’s unconstitutional. It will be blue slipped in the House of Representatives, and therefore, it makes absolutely no sense for us to be having this vote in the first place." While the blender’s credit and tariffs took a hit, lawmakers rejected a measure that would cut spending for ethanol infrastructure.
A Setback for Agriculture — Reflecting on the Senate vote, the National Corn Growers Association said petty politics trumped prudent policy. NCGA President Bart Schott, who farms at Kulm, North Dakota, described the vote as a big setback for agriculture. “Remember at the end of the year when we went for a one-year extension of VEETC, we promised reform, and Thune and Klobuchar did introduce a really good reform plan and we were kind of hoping that that would suffice; we’re pretty displeased.” Ethanol supporters will now regroup and strive to protect this industry. Growth Energy says the amendment threatened the only viable alternative to foreign oil. The American Coalition for Ethanol says the Senate bill has no chance of becoming law, but it does serve as a distraction for the industry.
Weekly News Highlights
Volatile Times — Conflict makes news and in the business of agriculture, there has been no shortage of conflict. With tight grain stocks and a slow start to the 2011 growing season, the markets are consistently chaotic. The Red River Farm Network is also seeing that level of pandemonium in Washington, DC. For the US Senate, attitudes about ethanol appear to be shifting and government support for the renewable fuel is on shaky ground. In the House, agriculture spending was in the cross-hairs during the debate over agricultural appropriations last week. The Red River Farm Network is committed to delivering the news impacting your business, complete with market and farm policy analysis.
Ethanol Takes a Hit — Two days after the Senate rejected an attempt to eliminate the ethanol tax incentive, the Upper Chamber reversed itself. With a 73 to 27 vote, lawmakers decided to end the 45-cent-per-gallon blender’s tax credit and the 54-cent-per-gallon tariff on imported ethanol. New Jersey Senator Robert Menendez was in the majority, saying the federal government delivers unprecedented support to the ethanol industry. In addition, Menendez says billions of dollars are also spent to subsidize corn production. “So, in a time of fiscal constraint, we simply cannot afford to prop up an industry with such enormous supports, and these supports are not just costing taxpayers money, but they are also causing food prices to rise and harming our environment.” South Dakota Senator John Thune argued his colleagues singled out the ethanol industry, punishing it by changing the rules in the middle of the game. In practical terms, Thune said the Senate vote was largely symbolic. “It’s unconstitutional. It will be blue slipped in the House of Representatives, and therefore, it makes absolutely no sense for us to be having this vote in the first place." While the blender’s credit and tariffs took a hit, lawmakers rejected a measure that would cut spending for ethanol infrastructure.
A Setback for Agriculture — Reflecting on the Senate vote, the National Corn Growers Association said petty politics trumped prudent policy. NCGA President Bart Schott, who farms at Kulm, North Dakota, described the vote as a big setback for agriculture. “Remember at the end of the year when we went for a one-year extension of VEETC, we promised reform, and Thune and Klobuchar did introduce a really good reform plan and we were kind of hoping that that would suffice; we’re pretty displeased.” Ethanol supporters will now regroup and strive to protect this industry. Growth Energy says the amendment threatened the only viable alternative to foreign oil. The American Coalition for Ethanol says the Senate bill has no chance of becoming law, but it does serve as a distraction for the industry.
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