BEWARE OF 15% ETHANOL GAS

As some of you may know, the very first gas station in the Country to sell 15% ethanol gas      (E-15) opened for sales in Kansas about two week ago.   I'm waiting for my webmaster to post an article I wrote a few weeks ago about 15% ethanol gas on my website's "Ethanol Articles" page.  Hopefully he'll post it by the end of this week.

We may not see it in Louisiana until late this year or next.  BUT, when you first see it in gas stations, DON'T BE TEMPTED TO TRY IT BEFORE READING YOUR VEHICLE'S OWNERS MANUAL.  Despite that EPA said it is safe to use in 2001 and newer passenger cars and light trucks, nearly ALL owners manuals for 2001 and new vehicles warn owner NOT to use gasoline with greater than 10% as engine damage could result.  They go further to say that if you do use gas with greater than 10% ethanol and damage does occur, the vehicle's warranty will be voided!  NEVER EVER use 15% (or anything greater than 10% for that matter) in any marine engine, motorcycle, 4 wheeler, jet ski, chainsaw, home generator or any gas powered lawn and garden tool.  It will destroy the engine and warranties will be void.  

A HUGE concern amongst retail gas station, convenience and grocery stores about carrying 15% ethanol gas is the significant liability concerns.  So, when it does come out in Louisiana, it will likely be in major branded stations.

"Pete"
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KPC Warns Consumers of E15 'Danger'
PUBLISHED JULY 16, 2012
BY HUW EVANS


Although it has been granted Environmental Protection Agency approval, the Kansas Petroleum Council has issued a warning over the use of E15 fuel by motorists.
Last Thursday, the council issued a statement declaring that E15 which contains 15 percent ethanol, and now available for sale in the state, “could damage vehicle engines.”
KPC’s director, Ken Peterson, said in reference to a three-year study conducted by both the automobile and oil industries, that “we need to press the pause button on EPA's rush to allow higher amounts of ethanol in our gasoline," said Ken Peterson, director of the Kansas Petroleum Council. "The new fuel could lead to engine damage in more than 5 million vehicles on the road today and could void the manufacturer's warranty."


The three year study conducted by the oil and auto industries concluded that using E15 could cause damage to engine and fuel system components and void manufacturer warranties even though the EPA has granted the fuel’s approval for use in 2001 and newer model year vehicles.
Kansas is currently the only state where Ethanol 15 is available and the only station that currently sells it, requires purchases to buy at least four-gallons per pump visit in order to prevent filling up for small engines used in implements such as lawn mowers, chainsaws and garden tractors which aren’t E15 compatible.
"Our first priority should be protecting consumers and the investments they've made in their automobiles," remarked Peterson. "EPA has an obligation to base this decision on science and not on a political agenda."
Kansas Petroleum Council via Autoblog Green

CORN PRICES SOARING AND WILL RESULT IN HUGE PRICE INCREASES IN FOOD PRODUCTS

Yet another article on the impact that the severe droughts in the corn producing States will have on food prices.....we should all e-mail our US Senators and Congressmen and URGE them to put pressure on the EPA to reduce their ethanol fuel mandate!  If not, we may be faced with severe food shortages and sky high prices on all food products in which corn is used.

If you don't know how to contact our US Senators and Congressmen, here's how to e-mail them:

Louisiana US Senator Vitter: http://vitter.senate.gov/public/index.cfm?FuseAction=Contact.ContactForm

Louisiana US Senator Landrieu:  http://www.landrieu.senate.gov/about/contact.cfm

Contacting your State’s US Senator:  http://www.senate.gov/general/contact_information/senators_cfm.cfm

Contacting your State’s US Congressman:  http://www.contactingthecongress.org/

"Pete"
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July 20, 2012 10:23 pm
Corn and soya prices continue to soar                                            By Emiko Terazono
Fears of a food shortage reverberated through commodities markets this week as corn and soyabean prices soared to fresh record highs amid the worst US drought in half a century, sparking fears of a repeat of the 2007-08 food crisis.
Although other grain staples such as wheat and rice remain lower, the weather disruptions in key agricultural areas around the globe, such as the severe drought in the US, a weak monsoon in India and a lack of rainfall in Russia threaten to push agricultural commodities prices higher.
The drought in the US Midwest had “completely changed the outlook for grains and oilseeds”, said Chris Gadd, grains analyst at Macquarie Securities. Earlier expectations that the US would see a bumper corn crop had been scuppered, and the grains market now faced a third consecutive year of poor supplies from the world’s largest producer and exporter, he said.  Benchmark soyabean prices on Friday hit a record high of $17.77¾ a bushel, while corn futures rose above $8 a bushel for the first time on Thursday, reaching a peak of $8.16¾.
The buying of corn and soyabeans was supported by US government data on the crops, which pointed to sharply lower harvests, as well as an official confirmation from meteorologists that the country was facing the worst drought in the US for half a century.
The US Department of Agriculture said in its weekly report that only 31 per cent of the corn crop was in “good to excellent” shape, down from 40 per cent a week earlier. For soyabeans, the figure fell to 34 per cent to 40 per cent.
Meanwhile, the US National Oceanic and Atmospheric Administration said the drought affecting the country was the worst since 1956 in terms of the areas suffering moderate to extreme effects.
Weather forecasts suggesting that the hot and dry conditions will continue were likely to lead to further cuts in crop production and yield predictions, said analysts. The Commodity Weather Group, a US weather consultancy, cut its corn yield estimate by 10 per cent from its July 5 outlook, to 136 bushels per acre, at the end of the week. This compares to the USDA latest number of 146 bushels per acre.
While US livestock breeders are hoping for some reprieve in the form of corn used for ethanol to be diverted to animal feed, Tom Vilsack, US agriculture secretary, this week rejected calls to ease the rules which mandate ethanol to be blended with gasoline. Analysts said that, with the powerful grain-producing states lobbying for the use of grains as fuel, the ethanol mandates were unlikely to be relaxed ahead of the US presidential election.
Despite the price rallies, many policy makers do not believe the world is facing a new food crisis because the global supply of wheat and rice, the two commodities most important for food security, remain relatively plentiful and prices are still below previous highs.

PRESSURE INCREASING TO REDUCE EPA ETHANOL MANDATE

With the severe drought in the corn belt states causing untold damage to corn crops, corn prices have increased to nearly $8/bushel.  With nearly 40% of corn grown this year destined for ethanol production, food prices, especially those using corn are very likely to skyrocket according to the US Department of Agriculture.  Pressure is mounting on Congress to demand that the EPA reduce the ethanol mandate, at least until the corn crop recovers, possibly next year.  Here's a recent article on the issue:

Is it time to reduce the ethanol mandate?

Rick Jordahl, Associate Editor, Pork Network   |   Updated: July 20, 2012

As the 2012 drought expands and intensifies across the heat-baked U.S. Corn Belt driving corn prices to all-time record highs, the Renewable Fuel Standard (RFS) mandating the production of ethanol is being debated with increased intensity.

With cash corn prices stretching up to record levels of $8 per bushel, many ask, ‘is now the time to reduce or waive the ethanol production requirement’? The answer to the question depends on who you ask.

The nation’s corn growers say leave the RFS alone. “When it comes to the Renewable Fuel Standard for ethanol and other biofuels, now is not the time for changes," says National Corn Growers Association President Garry Niemeyer in a statement responding to media coverage on the drought. “The RFS is revitalizing rural America, reducing our dependence on foreign fuel and reducing the cost of gasoline.”

A coalition of livestock and poultry groups, however, takes the opposite view. The group, which includes the National Pork Producers Council, is urging Congress to reform the RFS. The livestock and poultry producers cite a study conducted by Thomas Elam, president of FarmEcon LLC, showing that federal ethanol policy has increased and destabilized corn, soybean and wheat prices to the detriment of food and fuel producers and consumers.

“The increases we’ve seen in commodity prices are strongly associated with the RFS mandate,” said Elam. “At the same time, we haven’t seen the promised benefits on oil imports or gasoline prices. This means that while Americans are forced to pay more for food, they’re also not seeing lower prices at the pump; it’s a lose-lose situation.”

In comments to Pork Network, Ron Plain, University of Missouri agricultural economist, looks at several aspects related to reducing ethanol production.

According to Plain, one bushel of corn will produce about 2.75 gallons of ethanol and 17 pounds of distillers’ dried grains with solubles (DDGS), a co-product of ethanol production used to supplement livestock and poultry feed.

The RFS for calendar year 2012 is 13.2 billion gallons of ethanol from grain and 13.8 billion gallons for 2013, Plain says.  “At 2.75 gallons per bushel of corn, this is 4.8 billion bushels and 5.02 billion bushels, respectively. If ethanol production is reduced by 1 billion gallons, it would free up 363.6 million bushels of corn for feed or other use but, it would also reduce DDGS production by 3.09 million tons.”

Plain estimates that for every 1 billion gallon decrease in ethanol production, the feed supply increases by 7.09 million tons or the equivalent of 253 million bushels of corn,.

Plain also looks at historic relationship of projected corn yield and its effect on corn price. “In early May when USDA was predicting a 14.79 billion bushel corn harvest, December futures were trading at $5.00 per bushel.  On July 11 USDA predicted a 12.97 billion bushel corn harvest and December corn was trading at $7.00.  “So for a 1.82 billion bushel drop in production we had a $2.00 rise in price, or a $1.10  price rise per billion bushel decline in corn production.”

Plain believes it would be reasonable that the same relationship between corn availability and price also would work in reverse and a billion bushels of extra production would take $1.10 per bushel off of corn prices.

So what effect on corn price would result by decreasing ethanol production? “The math says that for each billion gallons of reduced ethanol production it would reduce corn prices by 28 cents per bushel (253/1000 times $1.10),” Plain estimates. “However, I would predict the decline would be more as it would establish a precedent and make corn demand for ethanol look much less assured.”

ETHANOL FROM COAL?

Here's an interesting article on Celanese chemical company buying a patent to make ethanol from coal.  This is not a new idea, but a patent that apparently allow this conversion with fewer emissions to the atmosphere.  Chemical companies currently manufacture ethanol.  However, the ethanol from corn industry was apparently given protection by refusing chemical companies from manufacturing ethanol for fuel blending use.  I suspect we may see lawsuits soon to deal with this unfair monoply.  You just know the large ethanol lobby group, Growth Energy will fight any efforts to open ethanol fuel blending by chemical companies.

"Pete"
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Celanese up on ethanol pact; takes aim at U.S. for new tech
July 19, 2012, 4:24 PM


Shares of Celanese Corp.  rose 5% Thursday after the materials company announced a new pact with Indonesia to use its TCX technology to produce ethanol from coal.  Using a closed process that keeps emissions lower than other coal  technologies, the TCX technology produces ethanol  at a price of about $1.50 to $2 a gallon.


Once the ethanol is produced, it burns more cleanly than petroleum products and helps reduce emissions from cars and trucks.
Mark Oberle, senior vice president of corporate affairs for Celanese, said the company’s TCX process could produce ethanol from multiple sources including natural gas, depending on whatever’s most economical in a given market.
“It’s a breakthrough technology that allows us to produce ethanol cost-effectively using a variety of feedstocks,” he said.


Currently, the U.S. Renewable Fuel Standard restricts coal as a raw material, or feedstock, to make ethanol, but Celanese would like that to change, Oberle said.  For now, the king of American renewable fuels remains corn-based ethanol, which is blended in gasoline at a rate of up to 15%.
For the time being at least, Celanese has plenty on its plate with its new ethanol deal in Indonesia. U.S. regulators may not go along with classifying coal as a renewable fuel, but if the TCX process proves its worth overseas, policy makers could warm up to it.

Retailers Are Concerned About Liability in Selling E-15

Good morning readers!  Some of you may have heard that the 1st gas station to sell 15% ethanol (E-15) opened for business about two weeks ago in Kansas.  It is NOT MANDATORY for stations to sell E-15.  And, many retailers have told me they are very apprehensive to even consider selling this gas due to the tremendous liability concerns.  This new fuel will likely be priced about $0.10/gallon cheaper than E-10 and may tempt customers to try it without considering the consequences.  I'll have an updated article about E-15 on my website's "Ethanol Articles" page in a few days.  The best thing I can offer to consumers when they see the new E-15 pump label on a fuel pump is "BUYER BEWARE"!

Here's an article about retailers liability concerns regarding this new fuel:

Retailers want liability protection before considering E15

By Kris Bevill | February 22, 2012 – Ethanol Producer Magazine

Liability issues surrounding the use of E15 remain a major concern for many retailers when considering offering the fuel to customers driving 2001 and newer vehicles. The U.S. EPA recently approved required health effects and emissions testing for E15, bringing the fuel one step closer to commercial availability for those drivers, but before retailers can begin selling the fuel for 2001 and newer vehicles, additional requirements must be met, including EPA approval of a misfueling mitigation plan for retailers. State regulations also need to be amended to allow E15 to be sold and retail infrastructure must be approved to store and dispense the fuel. The ethanol industry is working to overcome all of these hurdles, but it remains unclear when the process will be complete.

Iowa is expected to be the first state in the nation to allow E15 to be sold for 2001 and newer vehicles. The blend is already available at numerous blender pumps in the state for use in flex-fuel vehicles, giving those retailers a head start in offering it to other customers when they are able. The ethanol-friendly state also offers incentives to retailers who sell mid-level blends of ethanol and has a statewide renewable fuel standard, which further spurs retailers to make alternative fuels available. The ethanol industry has also been successful there in working through the procedural issues surrounding E15’s legality. “We have been looking at state policies and have modified the necessary policies and requirements to be in a position to offer E15 fairly soon after it goes through the formal approval process and all of the registration and other requirements have been met,” said Lucy Norton, managing director of the Iowa Renewable Fuels Association. “We have moved forward very quickly to put the pieces together here to enable retailers to put E15 in this market so consumers have additional fuel choices.”

For Iowa retailers, the main issue now is gaining approval of a misfueling mitigation plan, according to Norton. The Renewable Fuels Association submitted a mitigation plan to the EPA on Feb. 16 which the group said could serve as a model plan for fuel retailers to follow in order to demonstrate regulatory compliance, but it is unclear when the EPA might approve the RFA’s plan. And some retailers say they will need even further assurance before they begin offering E15.

Minnesota-based CHS Inc., a cooperatively owned diversified energy, grains and foods business which supplies fuel to approximately 1,400 branded retail petroleum outlets and is the nation’s leading E85 retailer through its 800 Cenex-branded convenience stores located throughout the Midwest, said it will continue to support retailers’ decisions to install blender pumps but, as a company, it won’t consider selling E15 until multiple factors are addressed. Issues of concern include liability issues for vehicles and equipment, potential gasoline compatibility issues related to Reid Vapor Pressure levels and state and local fuel regulations, according to Lani Jordan, director of corporate communications at CHS, who added that the business remains committed to providing fuel that meets the broad needs of consumers now and in the future.

Jeff Lenard, vice president of industry advocacy for the National Association of Convenience Stores, said the potential for misfueling liability and the cost of acquiring equipment to sell E15 are two significant hurdles for retailers, but his group is also concerned about consumer acceptance of the fuel. “Retailers must obtain the appropriate storage tanks and dispensers to sell the product, and this can be a very expensive investment,” he said. “In order to justify such an investment, a certain level of consumer demand must exist. Given the opposition of the auto manufacturing industry to E15 and their concerns about the use of the fuel in current vehicles, it is very difficult to evaluate potential consumer demand.” Lenard added that while the NACS believes the EPA’s misfueling regulations are practical, there is still concern that retailers who comply with those regulations won’t receive adequate liability protection. “NACS is pursuing legislation that will provide such legal protection to ensure that a retailer who complies with EPA’s misfueling program cannot be held responsible in the event a self-service customer ignores or disregards the label and introduces E15 into a non-approved engine,” he said.

Valero Energy Corp., which produces more than 1 billion gallons of ethanol annually, more than any other company in the U.S. aside from Archer Daniels Midland Co. and Poet LLC, said it has no intention of selling E15 at any of its 1,000 company-owned retail fuel stores. “Because E15 has not been approved for use in all engines and hasn’t received warranty protection from engine manufacturers, we can’t guarantee its performance and we won’t sell a product we can’t guarantee,” said Bill Day, executive director of media relations for Valero. Some Valero-branded fuel stations are independently owned, however, and Day said those stations can choose to offer E15, but they would have to locate the dispensers under a separate canopy.

‘Real gas’—what does it mean?

Here's a rather interesting article on "What is Real Gas"?  I don't think anyone who has experienced the nightmares of ethanol gas really questions what real gas is...........

Wednesday, June 6, 2012  Idaho Mountain Express and Guide

‘Real gas’—what does it mean?

Some retailers are rejecting ethanol-based fuel

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By KATHERINE WUTZ
Express Staff Writer

Signs for "real gas"—that is, gas not blended with ethanol, a corn-based fuel additive have been cropping up all over the valley, and proponents say it's better for cars, better for small engines and possibly better for Idaho farmers.

What is ethanol?

Ethanol is a corn-based fuel, related to the intoxicating ingredient found in alcoholic beverages. It's nothing new—according to numerous sources, the original Model T Ford was able to run on ethanol.

A federal mandate issued in 2006 required oil refiners to blend 36 billion gallons of renewable fuel—including 15 billion gallons of corn-based ethanol—into gasoline by 2022.  That's why, unless otherwise noted, most gas stations use gasoline that has been blended with the corn-based biofuel.

"The EPA mandates that we use a certain number of gallons of ethanol each year," said Carlton Carroll, spokesman for the American Petroleum Institute in Washington, D.C. "We're reaching the point where refineries are required to blend ethanol into almost 100 percent of their gas."

Ethanol economy

Inherently, there is nothing wrong with ethanol fuels, most experts agree. The Renewable Fuels Association, an ethanol industry group, estimates that 62 percent of cars on the road today can withstand gas with an even higher amount of ethanol included than is currently available.  Carroll said that ethanol fuel actually has a higher performance level than regular petroleum.  "It does have higher octane than regular gasoline," he said—an estimated 113 rating as opposed to regular unleaded's 87 rating.

An 85 percent ethanol blend is the official race fuel of the Indy 500, and all drivers are required to use it.

But for everyday driving, Carroll said, ethanol-blended fuel might not be the best choice.

"The downside to ethanol-blended gasoline is that it doesn't get you as far," he said.

Dusty Wendland, manager of the Uptown Mini-Mart in Hailey and the Mountain View Grocery Express just south of Ketchum, said he's found that ethanol-blended gasoline actually reduces a car's fuel efficiency by about 4 percent.

The Department of Energy reports that ethanol is actually even less efficient than Wendland's estimates—30 percent less efficient than pure petroleum-based gasoline.

"We're not reducing oil dependency, and you're getting less-quality gas," Wendland said. "The stuff they're using locally in the valley is still 90 percent fossil fuel, [but] you're not 10 percent less reliant on fossil fuels."

Consumers must use more fuel in order to drive the same number of miles, Wendland said—and because ethanol blends are cheaper than nonblended gasoline, distributors have a bigger profit margin.

Wendland said the gas he buys comes at a premium of 8 to 15 cents per gallon, giving his competitors a higher profit.

"If you're making a dime extra [per gallon], that's $200 a day," he said, as his station in Hailey typically sells 2,000 gallons each day.  In addition, Wendland said he has to obtain gas from Montana, which increases his costs even further.

But it's not just the die-hard "real gas" retailers who are suffering. Idaho Farm Bureau spokesman John Thompson said Idaho farmers can't grow enough corn to feed their livestock, and the rising cost of corn due to ethanol has raised their costs.

"The corn that gets made into ethanol here in Idaho all comes mainly from Nebraska," he said. "It helps keep the price higher than it would be. Over 30 percent of the corn grown in the country [is made into ethanol]."

And the rising costs don't always result in higher market prices for farmers' beef, Thompson said.

"There's not always that connection," he said. "All red meat prices are higher now because we have had that terrible drought in Texas ... so that has reduced the availability of red meat and the prices have gone up. But it's not necessarily directly related to ethanol."

In other words, Thompson said, Idaho farmers are paying more for corn and not getting more for their cows, due to the nation's use of ethanol. Still, Thompson said the organization supports the use of ethanol fuel.

"Our organization has supported ethanol because every gallon of ethanol we produce reduces our dependence on foreign crude," he said. "But the livestock industry doesn't like it."

Proponents argue that ethanol contributes to the U.S. economy and drives fuel prices down. According to a study from the Center for Agricultural and Rural Development, America's use of domestically produced ethanol reduced wholesale gas prices by an average of $1.09 a gallon in 2011—up from $0.89 in 2010.

Report co-author Dermot Hayes told the Renewable Fuels Association that ethanol has helped alleviate a number of fuel supply problems in the United States.

"It is as if the U.S. oil refining industry had found a way to extract 10 percent more gasoline from a barrel of oil," he said, adding that periodic gasoline shortages caused by refinery capacity are essentially a thing of the past.

"It ... allowed the U.S. to switch from being a net importer of gasoline to a net exporter," he said "As a result of these changes, U.S. gasoline prices are measurably lower than would otherwise have been the case."

The Renewable Fuels Association estimates that because of the price drop, the average American family—one that consumed the national average of 1,124 gallons of gasoline in 2011—saved roughly $1,200 last year. A study from the Global Renewable Fuels Alliance reported that in 2010, the global biofuels industry supported 1.4 million jobs and is expected to support 2.2 million jobs by 2020.

Ethanol as fuel

According to the Renewable Fuels Association, ethanol is safe for use in all cars and small engines. In fact, the organization's website states that 62 percent of all cars on the road today can handle gasoline with an even higher ratio of ethanol than is used currently, and that most warranties cover the use of ethanol-blended gas in small engines such as those in lawnmowers and snowmobiles.

But Randy Van Dyke, president of a motorcycle riding group called the Idaho Mountain Dirt Riders Association, said he flat-out refused to use ethanol-blended fuel in his bikes—or any of his other vehicles, for that matter.

"It's really a terrible product," he said. "It destroys the carburetors [on bikes]. Almost everyone I know gets less gas mileage and their cars run terrible."

Randy Goddard, co-owner of Woodside Motor Sports in Hailey, said it's true that ethanol is hard on smaller engines, such as those in motorcycles, snowmobiles and even chainsaws and other gas-powered tools.

Ethanol is a solvent, he said, which means it will dissolve "gunk" in the vehicles' engines and plug up the vehicles' carburetors.

Sun Valley Auto Club owner David Stone said the same is true for older, classic cars—or anything older than model year 2000.

"The cars aren't made for it," he said. "It will go in your engine, it will free up that gunk and clog the fuel filter. Because of that, the fuel pump dies. It's so bad."

Stone said the valves and fuel pumps in older cars are also damaged by the ethanol.

"Anything that's rubber, like rubber hoses, rubber valves—anything that's rubber, it ruins it," he said. "Anything plastic or rubber, ethanol hurts."

However, the Renewable Fuels Association says that newer cars are built to withstand the ethanol blend, with higher-quality rubber, metal and plastic to prevent the type of problems Stone is referring to.

 

Ethanol and the environment

Even if it damages older cars, the argument that ethanol reduces dependence on foreign oil could be appealing. And when the federal mandate was issued, conservationists said the possibilities of replacing fossil fuel with renewable fuels seemed worth supporting.

"A lot of environmentalists supported corn ethanol five years ago because the best science at the time showed it could be a stepping stone," Nathanael Greene, director of renewable energy policy for the Natural Resources Defense Council, told the Christian Science Monitor in 2009. "The science changed."

According to the Renewable Fuels Association, the use of ethanol helps reduce carbon emissions by anywhere from 30 to 50 percent. In 2011, carbon emissions were reduced by 25.3 million metric tons due to the use of cleaner-burning ethanol.

However, Courtney Washburn, community conservation director for the Idaho Conservation League, said that ethanol as a whole does not make sense for Idaho's environment.

"I think a lot of people are led to believe that, but ethanol is not better for the environment," she said. "The [mandate] for ethanol would have us importing corn from other states, which would have us using more fuel. And because of the energy that does into corn production already, putting more energy into it to make it a fuel doesn't make it an environmental benefit."

 

So what?

Stone, Wendland and Van Dyke agreed that ethanol does not harm newer vehicles. Even though the drivers may not get optimal gas mileage using it, newer cars, especially those designated as "flex fuel" cars, have stronger plastics and rubbers that can withstand the ethanol's dissolving powers.

Still, Stone said he wouldn't use it—and he'd recommend that his customers don't either.

Katherine Wutz: kwutz@mtexpress.com

Related Businesses Who Were Glad to See the End to Ethanol Subsidies

There are many businesses that were very happy that the ethanol tax subsidy was allowed to expire on January 1st of this year.  Here's an article on what one of the related businesses that were very happy to see this stop:

Dairies hail end of ethanol subsidies

Dairy groups hope tax credit, tariff expiration will lead to lower corn prices

By CAROL RYAN DUMAS

Capital Press

Dairy groups are among those claiming victory in the elimination of the ethanol blenders tax credit and tariffs on imported ethanol, which expired Dec. 31 without renewal by Congress.

The fuel industry had received a 45-cent per gallon tax credit to blend ethanol with gasoline, and were protected from foreign competition by a 54-cent per gallon tariff on imported ethanol.

That policy drove up the price of feed to livestock producers, said Bob Naerebout, executive director of Idaho Dairymen's Association. Most ethanol is made from corn.

"High feed cost has made it extremely difficult for dairy producers to break even," he said.

Livestock producers have made no bones about blaming those high costs on the subsidized ethanol industry and have taken their concerns to Congress.

California Milk Producers Council is excited about the expiration of the tax and trade subsidies, said Rob Vandenheuvel, the council's manager.

"While the direct impact on corn prices is unknown at this point, it's a great step forward," he said

But Scott Brown, ag economist with the Food and Agricultural Policy Research Institute, University of Missouri, expects the impact to be small because world demand for grain is high, and the Renewable Fuel Standard, which mandates increasing amounts of ethanol and other alternative fuels be used, is still in place.

Brown's analysis found that the blenders credit only added 2 cents per bushel to the price of corn. The tariff on imported ethanol added 11 cents, and the Renewable Fuel Standard added 18 cents.

The effects of all the policies working together amounted to 53 cents a bushel, he said.

Analyses by the Congressional Budget Office and Iowa State University's Center for Agricultural and Rural Development are in the same ballpark, with the CBO showing an effect of 50 to 80 cents per bushel and CARD showing 59 cents per bushel.

Corn prices jumped from about $2.25 a bushel in 2001-02 to more than $6 today. But many factors have contributed to the increase, he said, including strong international demand for corn and soybeans, and for meat and dairy products.

"Yes, we've tripled corn prices, but you can't attribute all associated (price increases) to ethanol," he said.

The ethanol mandates in the Renewable Fuel Standard remain an issue.

"Expiration of these subsidies and tariffs would have a much bigger impact if the RFS were not still in place," said Michael Marsh, executive director of Western United Dairymen's Association.

If the RFS went away, there would be a huge reduction in the cost of feed, he said. That's a fight livestock groups and others will continue.

"We're tickled we got part of the job done," he said.