shorthorns r us
Well-known member
- Joined
- Apr 9, 2007
- Messages
- 900
Economist Claims that "The biofuels program is, in effect, a regressive tax on food production."
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At the recent American Meat Institute meeting in Nashville, a strong case was made about the high cost of ethanol policy on corn prices we have seen in this country. The actual increase that ethanol policy has provided is about $2.77 per bushel for farm level prices in 2008, according to economist Dr. Tom Elam, the president of FarmEcon LLL. Speaking at AMI's Annual Meat Conference in Nashville this week, Dr. Elam said ethanol tax credits have added about $1.33 per bushel to corn prices and may drive costs above $5 at the farm level in 2009.
Dr. Elam cites other impacts from the nation's biofuels program including:
An additional cost this year of $117.50 per fed beef animal.
Ethanol would have been $1.69 a gallon, but increased demand for corn and higher corn prices are driving prices up, and they now are 51 cents a gallon higher than they would have been without the program.
The biofuels program is, in effect, a regressive tax on food production. Dr. Elam contends that the windfall gains from the program go to a relatively small number of corn and soybean producers.
Elam adds that the federal government's renewable fuel program will also lead to a financial hit on the U.S. food industry of about $100 billion from 2005 to 2010, adding that he expects food price inflation to be around 5% or 6% in 2009.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
At the recent American Meat Institute meeting in Nashville, a strong case was made about the high cost of ethanol policy on corn prices we have seen in this country. The actual increase that ethanol policy has provided is about $2.77 per bushel for farm level prices in 2008, according to economist Dr. Tom Elam, the president of FarmEcon LLL. Speaking at AMI's Annual Meat Conference in Nashville this week, Dr. Elam said ethanol tax credits have added about $1.33 per bushel to corn prices and may drive costs above $5 at the farm level in 2009.
Dr. Elam cites other impacts from the nation's biofuels program including:
An additional cost this year of $117.50 per fed beef animal.
Ethanol would have been $1.69 a gallon, but increased demand for corn and higher corn prices are driving prices up, and they now are 51 cents a gallon higher than they would have been without the program.
The biofuels program is, in effect, a regressive tax on food production. Dr. Elam contends that the windfall gains from the program go to a relatively small number of corn and soybean producers.
Elam adds that the federal government's renewable fuel program will also lead to a financial hit on the U.S. food industry of about $100 billion from 2005 to 2010, adding that he expects food price inflation to be around 5% or 6% in 2009.