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Corn+Soybean Digest

Vilsack: Helping Ethanol Industry a priority


Helping the U.S. ethanol industry survive current hard times is a priority, Agriculture Secretary Tom Vilsack said Monday, adding that he will be looking at a variety of different ways to do that.

One specific way to help out is through offering government assistance to make sure that refineries are as efficient as they can be, he said.

But there may also be other ways to help a U.S. ethanol industry that has been plagued with bankruptcies and production halts from companies that suffered from sharply fluctuating corn and gasoline prices in 2008, Vilsack told Dow Jones Newswires.

"I haven't had a chance to meet with staff about a whole series of other options," he said. "I just want to make sure I know all the implications and all of the options that are available."

Vilsack also laid out a three-pronged approach to making sure the corn-based ethanol industry is able to continue to increase production and meet rising targets set by Congress.

Fundamentally, he said, it's about improving "efficiencies of existing operations," he told Dow Jones Newswires. "It's about looking at ways in which markets can be expanded, and it's also how you might be able to provide some bridge from hard times to better times. Those are the three strategies."

Congress passed a renewable fuels standard in December 2007 that mandated 9 billion gallons of ethanol be blended into gasoline in 2008. This year, that climbs to 10.5 billion gallons, and it increases yearly until it reaches 15 billion gallons in 2015.

Nearly all commercially produced ethanol in the U.S. is made from corn, but within just a few years some of that fuel is expected to be produced from second-generation, or cellulose, feedstocks like wood chips and other agricultural waste products.

Vilsack, in a Monday teleconference with reporters, said: "We need to make sure that the [corn-based ethanol] industry has the necessary support to survive the recent downturn, while at the same time promoting policies that will speed up the development of second- and third-generation feedstocks for those biofuels that have the potential to significantly improve America's energy security and independence."

Editor’s note: Richard Brock, Corn & Soybean Digest's marketing editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

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