Ethanol changes will decrease farmer incomes, official says

Farmers will see less income and oil companies will get more from a new ethanol rule the federal government is likely to impose, a official from Leipsic’s Poet Biorefining facility said Thursday.

Within weeks, the Environmental Protection Agency will likely revise downward by 10 percent this year refiners’ ethanol-blending requirements, said Mark Borer, general manager of Poet Biorefining. The federal move will delay a coming trend of fuel stations selling fuel containing 15 percent ethanol instead of 10 percent ethanol, he said.

Borer said oil refiners oppose the trend to more ethanol in fuel because it means they lose revenue.

Ethanol is cheaper than gasoline, so fuel containing more ethanol is cheaper and likely to sell faster than pure gasoline, he said.

“The oil industry has fought pretty hard to keep from having to (produce higher-ethanol fuel blends) because we’ve gotten 10 percent of the market,” Borer said. “We’re very confident that if the consumer gets a chance to go to the station and select E-15 at a lower price than E-10, they’re going to do that. So, that will further erode the oil industry’s market share, which again, they are fighting.”

But lower ethanol production, means less use of corn. That will lower corn prices and hurt farmers, he said.

If the ethanol reduction persists, it will reduce land and farm values, Borer said.


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