Biodiesel defenders support the industry

By | July 14, 2008
In May, Sen. Charles Grassley exposed the campaign being waged by the Grocery Manufacturers Association to discredit biofuels. "It turns out that a $300,000, six-month retainer of a beltway public relations firm is behind the smear campaign, hired by the Grocery Manufacturers Association," Grassley said. Since then, many others have come to the defense of biodiesel.

A few days after Grassley's initial remarks, the USDA released economic analysis that shows high energy prices, increasing global demand, drought and other factors-not biodiesel-are the primary drivers of higher food costs. The study went on to say biofuels production has cut consumption of crude oil by 1 million barrels per day, offering savings of $120 million per day. In addition, the USDA posted economic analysis and charts that document that "even with the current uptick in food price inflation, it is much lower than it was in the 1970s and early 1980."

Grassley recently spoke to the National Biodiesel Board and reiterated his stance. "This campaign is led by an organization that should be a loyal member of the food chain," he said. "Instead, they are making biofuels the scapegoat to defend their own bottom line. The truth is that America's family farmers are producing more food and fuel than ever before."

In a letter addressed to Sen. Jeff Bingaman, chairman of the Committee on Energy and Natural Resources, Secretary of Energy Samuel W. Bodman and Secretary of Agriculture Edward T. Schafer said it is clear that "biofuels are already moderating gasoline prices. That impact is likely to grow substantially as more biofuels come to market. Our preliminary analysis further suggests that current biofuels-related feedstock demand plays only a small role in global food supply and pricing. Moreover, the impact of biofuels on U.S. consumers is even smaller since the farm price of commodities accounts for less than 20 percent of U.S. consumers' food costs."

Schafer pointed to the fact that oil prices have broken through a series of price ceilings this year. "Developing diversity in our portfolio of fuels is, if anything, an even more urgent matter than it has been in the past," he said. "And it is one that remains central to our energy security and our national security. The policy choices we have made on biofuels will deliver long-term benefits."

In 2007, U.S. biodiesel production hit the 500 million-gallon mark, displacing 20 million barrels of petroleum imports. If the United States replaced 5 percent of its on-road petroleum diesel fuel with biodiesel, it would replace about 1.85 billion gallons of diesel fuel per year, or the entire amount of diesel fuel currently refined from crude oil imported from Iraq.
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