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Corn farm

In 2007, then-president George Bush signed a law that required increased production of ethanol. Swelling ethanol demand for fuel combined with this past summer's drought has driven the price of corn (used to make ethanol) up. In fact, prices have swollen some 400 percent in the last seven years. That's comforting for corn growers, who are dealing with much smaller yields than normal. But it's not comforting for livestock producers, poultry farmers and grocery shoppers.

Under the law, the amount of ethanol used in gasoline is supposed to increase to 15.2 billion gallons this year, up from five billion in 2007. The Environmental Protection Agency can decide to delay the increase, however, and it has until Tuesday to consider the circumstances. According to The Detroit News, governors from eight states have asked the EPA to waive the ethanol requirements to prevent corn prices from going any higher. They join almost 200 members of Congress, top United Nations officials, two dozen scientists and scores of poultry farmers in opposing the boost in ethanol production. Governors of poultry-producing states Maryland and Delaware say without a waiver, thousands of jobs could be lost.

On the other side are corn-producing states and the farmers who live there. They argue a waiver would harm their agricultural income and, in turn, harm their state economies.

If a waiver is granted, gas formulations might not be affected at all. E10 gasoline (10-percent ethanol) would still be sold at fuel stations across the nation, but an increase in ethanol production would be delayed. If a waiver is not granted, corn growers will see a demand in their product. And since all that new ethanol has to go somewhere, drivers may see more pumps serving E20 E15 gasoline (20 15-percent ethanol) which cannot be used in pre-2001 vehicles.

How this summer's drought might affect your car's gasoline originally appeared on Autoblog on Wed, 14 Nov 2012 18:30:00 EST. Please see our terms for use of feeds.

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