Let’s start off with a survey. How many of you use ethanol in your vehicle, whether E-10 or E85, no matter what the price difference between regular and ethanol? When I fill my tank I use ethanol no matter the price difference. Ethanol has taken a bashing in the media the last couple of years and much false information has been spread. Some claim it uses more energy to produce ethanol than it creates. Others blame the increase in food prices on ethanol production. Still others claim that ethanol survives only because of the large subsidies that it receives.
There are studies by the USDA, University of Nebraska, and Argonne National Laboratory that clearly show that the production of ethanol creates at least 1.67-2.1 BTU’s for every BTU used to grow, irrigate, harvest, transport, and manufacture ethanol. Over the years ethanol plants have become even more efficient with advances in technology used in the manufacturing process. So the evidence clearly shows that we are creating more energy than we use to produce ethanol. This in turn keeps us from having to import more oil from countries overseas that are not necessarily friendly to the United States. These dollars are kept at home creating more jobs and tax revenue for our state. Nebraska is now the second largest ethanol producer in the country and ethanol production has created thousands of good paying jobs in rural areas of Nebraska and paid millions of dollars in taxes and property taxes to state and local governments and school districts. Nebraska’s financial condition is the envy of the country in these tough economic times.
Now let’s look at the food fuel debate and see what the effect ethanol production has had on the price of food. First let’s look at the demand side of corn. For years the demand for corn for livestock feed has remained relatively steady. The export market has had much more volatility over the years but overall has also remained relatively steady. When you look at our ability to increase our yield per acre over the last number of years you will see that ethanol production has only used the amount of corn that has come from our increase in yield. Bio-tech seed, GPS steering, yield mapping, spray controllers and computers have allowed us to increase yields faster than demand and if not for ethanol production we would have a huge surplus of corn and the economy in rural areas would have continued to stagnate. The cost of oil has had greatest impact on the price of food when you consider that oil is used in all aspects of the production of food from planting a crop to the distribution of the finished product. When you realize that there is only 8.6 cents worth of corn in a 12 oz box of corn flakes, 27.8 cents to produce a pound of ground beef, or 19.3 cents of corn in a gallon of milk then you see that the price of corn we producers receive has very little impact on the price of food at the grocery store. Farmers receive about 11.6 cents of every dollar spent on food, this compares to about .40 cents of every dollar spent in 1950.
Ethanol’s .45 cent blender’s credit expired January 1 and so far has had little impact on the profitability of ethanol manufacturers. The blender’s credit went to the oil companies not the ethanol producers. This credit was created to appease oil companies that were forced to blend ethanol into their gasoline through the RFS (reformulated fuel standard) that required an oxygenate in gasoline. The only other oxygenate on the market was MTBE which was shown to contaminate groundwater. The oil industry currently receives far more tax breaks than the ethanol industry has ever received. The ethanol industry has done more to revitalize rural communities than anything that has happened in the last 50 years.
Let’s keep our dollars at home by using ethanol, the only viable replacement for imported oil. It’s like shopping in your local community, everybody wins. The rural areas of the country have not seen the economic hard times that have plagued the more urban areas of the country and much of this is due to agriculture. Ask your fuel supplier to furnish blender pumps that give you a choice as to which fuel you chose to use in your car, whether it’s E10, E15, E30 or E85. Ethanol is my choice.
