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Biden’s Corn-based Biofuel Directive Could Jack Up Food Prices

A Potential Game-Changer or a Threat to Food Security?


By year’s end, the Biden administration is likely to release a directive on regulatory subsidies for ‘sustainable aviation fuel’ (SAF) sourced from corn, which could inflate food costs and inadvertently promote habitat-unfriendly agricultural practices.

This proposed rule change anticipates granting tax credit access to SAFs procured from corn-based ethanol, contingent upon approval under the Inflation Reduction Act, as disclosed to Reuters.

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In the event of implementing this change, corn-based ethanol is projected to significantly contribute towards the administration’s ambition to meet all demand through SAFs by 2050 aimed at counterbalancing global warming.

Nonetheless, a variety of environmental and economic concealed costs might accompany this transition to a corn-based aviation fuel, triggering potential challenges that might outweigh its benefits, industry analysts theorize.

Relying on corn-sourced ethanol aviation fuel might not severely impact global warming, yet it could potentially boost the renewable fuel industry and indirectly spike corn prices, postulates Professor C. Ford Runge, Distinguished McKnight University Professor of Applied Economics and Law at the University of Minnesota.

He suggested in a conversation with DCNF that the financial burden of such fuel would fall on the general public, taxpayers, and the environment, as has occurred in the past when government policy led to its mandatory use in vehicles.

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On the heels of prior mixed experiences, well-organized bipartisan and well-funded initiatives from the renewable fuel lobby continue to move forward, despite arguments stating ethanol offers limited efficiency and environmental benefits. The governmental aspiration, if achieved, would see 35 billion gallons of SAFs annually fuelling the aviation sector, as per guidelines from the Department of Energy (DOE).

This initiative is orchestrated to reduce carbon emissions; however, the potential environmental and economic toll related to the crafting of corn ethanol aviation fuel could overshadow any possible emission reduction victories. Mark Jacobson, a professor of Civil and Environmental Engineering at Stanford University, asserts in a discussion with the DCNF that SAFs do not wholly resolve our climate issues, far less provide an effective solution.

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‘The coefficients of emissions from corn-sourced ethanol range between 0% to 24% higher as compared to conventional gasoline. It also amplifies the price of corn, indirectly impacting the cost of food’, asserts Jacobson. Currently, approximately 40% of the American corn crop is harnessed to produce ethanol, a considerable jump from 10% during the mid-2000s as cited by The New York Times.

This massive increase in ethanol production has led to larger tracts of land—almost 100 million acres, primarily in the Midwest—being designated for corn cultivation. This development coincides with notable airline companies beginning to invest in SAF initiatives and infrastructure.

A flip side to greater ethanol production is the reduction in corn availability for livestock feed, compelling farmers to bear higher feeding costs. These escalated costs inevitably trickle down to consumers contributing to an inflationary spurt, warns Farm Aid, a renowned agricultural advocacy organization. Furthermore, the increase in feed costs often deters production, which indirectly lifts consumer prices for poultry, beef, pork, eggs, and dairy goods.

Corn-derived products form an integral part of a variety of processed foods; hence these consumer items are also likely to experience a price swell. Similarly, heightened corn output could coerce farmers into reducing wheat and soy production, indirectly causing cereal and grain prices to surge.

‘There’s no palpable proof to substantiate that biofuels, primarily corn ethanol, are superior in curtailing emissions’, avers Runge, a well-published critic of the ethanol industry. Besides the economic repercussions of enhanced corn ethanol production, many are concerned about the possible environmental toll associated with a surge in corn farming.

Given the likelihood of increased reliance on corn-produced ethanol SAF to meet airborne travel needs, the nation’s groundwater resources are set to face added pressure, affirms The New York Times. The cultivation of corn entails large water inputs, often requiring several hundreds of gallons of water to produce just one gallon of ethanol.

Particularly in corn-farming regions such as Kansas and Nebraska, aquifers are already under immense strain owing largely to the demands of agricultural irrigation. Eventually, the harvested corn is transformed into ethanol, then shipped for its intended use to power aircraft.

Jacobson points out the caveats associated with the lifecycle of the fuel: ‘Emissions throughout the process from field to aircraft are plentiful. They arise from fertilizing, watering, ploughing, transporting the harvested corn to a refinery, modifying corn into ethanol, and the ensuing intermodal transport needed due to ethanol’s inability to be transported in pipelines.’

Despite placing a request, there’s been no immediate feedback from the White House, the Department of Agriculture, and the DOE on the proposed guidance and the concerns raised by experts.


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