WASHINGTON, D.C. (Reuters) – Livestock producers and food industry groups are attempting to overturn a U.S. decision to allow higher levels of ethanol in gasoline, saying it could push up food prices.
The Grocery Manufacturers Association, the National Meat Association and the American Meat Institute (AMI) were among the groups that filed a lawsuit against the Environmental Protection Agency alleging regulators overstepped their authority when they ruled last month gasoline retailers could sell fuel containing up to 15 percent ethanol instead of 10 percent.
The EPA ruled that cars built in 2007 and later could burn the fuel, known as E15.
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“This will put pressure on the meat and poultry supply, which will lead to higher food prices for consumers,” said AMI president J. Patrick Boyle.
Ethanol is made mostly from corn in the United States. Food groups say E15 will increase corn demand and meat prices because livestock eat the grain. About one-third of the U.S. corn crop is used to make ethanol.
The food groups said the EPA did not have the power to make the decision.
“In approving E15… the EPA has clearly exceeded its authority under the Clean Air Act,” the coalition said.
“The agency has a legal obligation to adhere to the letter and spirit of the Clean Air Act and, in this case, has failed to do so.”
The EPA defended its action. “First and foremost, EPA’s decision was based on strict adherence to the Clean Air Act and grounded firmly in science,” said Betsaida Alcantara, a deputy press secretary at the agency.
The EPA will decide by the end of the year whether to allow E15 for cars built from 2001 to 2006, pending the completion of tests by the energy department.
Growth Energy, the ethanol industry group that had asked for the E15 waiver, said food companies, and not ethanol production, have raised food prices.
“In 2008, these big food companies gouged consumers while trying to shift the blame to America’s ethanol producers and farmers, so we’re not surprised by their actions today,” said Growth Energy head Tom Buis.
Ethanol producers have said new agronomic practices such as hybrid seeds are pushing up corn yields and there will be plenty of grain for everyone. They also said they need E15 to reduce a growing glut of supply brought about by government mandates that call for increasing amounts of ethanol to be blended into the overall gasoline supply.
In an effort to trim reliance on foreign oil, U.S. mandates require 15 billion gallons of ethanol to be blended into gasoline by 2015, up from 12 billion gallons this year.
Industry groups for automobile manufacturers, oil refiners and gasoline filling stations have also opposed the EPA ruling.
