NC Representative Backs Suspension of the Renewable Fuels Standard
The National Pork Producers Council praised a group of congressional lawmakers for asking the U.S. Environmental Protection agency to waive the federal mandate for the production of corn ethanol to help livestock and poultry producers weather the worst drought in more than 50 years.
Led by Reps. Bob Goodlatte, R-Va., Steve Womack, R-Ark., and Mike McIntrye, D-N.C., 156 members of the House asked EPA Administrator Lisa Jackson to waive the Renewable Fuels Standard (RFS) for the rest of the year to “help ease corn supply concerns and protect American consumers, livestock producers, and the economy.”
The lawmakers’ request follows the filing Monday by a coalition of livestock and poultry organizations, including NPPC, of a petition asking EPA to grant in whole or in part a waiver of the RFS for the remainder of 2012 and for part of 2013.
Central US Drought Continues to Ravage Crops
Nearly 50-percent of the U.S. corn crop is in poor to very poor condition – and Ag Secretary Tom Vilsack says the full extent of the drought’s impact on fuel production won’t be known until harvest. Margins for ethanol plants already have started to drop – enough so that some plants have quit producing ethanol. Current cash market prices are the lowest they have been in decades – according to Cornell University Associate Professor of Economics and Agribusiness Management Todd Schmit…
“What we are seeing most recently with the changes in prices, is that since about 2009, the return over variable cost has been decreasing with higher relative prices of corn. If this continues moving forward and we see a softening of ethanol prices of about 10%, we could be seeing a signal for these plants to be shutting their doors.”
Schmit says the current return for every dollar of input costs is 78-cents.
Drought Worsens in Central US, Improves in Carolinas
The latest U.S. Drought Monitor shows an increase in extreme drought conditions in four Plains states but a slight decrease in the overall area of the lower 48 states experiencing some form of drought. Ed Olenic, Senior Meteorologist at the National Oceanic and Atmospheric Administration, on where conditions are improving:
“There have been some precipitation events in the deep south, including Texas and Louisiana, and those regions have improved.”
Nearly two-thirds of the lower 48 states is experiencing some drought. Recent rainfall pushed the percentage down to 62.91, from last week's 63.86. The report says one-fifth of the U.S. is experiencing extreme drought.
On the other hand, the Carolinas, at minimum, have been able to maintain, if not improve on drought status according to staff meteorologist Kyle Bridgers:
“We have seen some improvements in North Carolina and parts of South Carolina and Virginia. But in South Carolina the western part of the state has stayed the same over the last few weeks, only receiving ¼-1” of rain.”
There’s currently a tropical system in the Atlantic that probably won’t make US landfall, but one forming off the coast of Africa currently about 12 days out could affect the US Atlantic coast.
House Votes to Extend Tax Cuts Another Year
The U.S. House of Representatives late Wednesday night voted to extend the current tax code for another year. This includes keeping the estate tax, known as the death tax, at its current level of 35 percent for estates worth more than $5 million per individual and $10 million per couple. Even though full repeal of the death tax is the top priority for NCBA, Kent Bacus, associate director of legislative affairs, says the plan passed by the House today is a step in the right direction.