Ethanol Mandate Considered 'Undue Hardship'

WASHINGTON, D.C. - The price of corn is just about as hot as the Wingstop fast-food chain's "atomic" chicken wings. The company feels the need to do something about this entire situation.

7 July 2008

2 minute read

North America

Wingstop's chief executive, James Flynn, is joining with livestock producers and meat processors in calling for the government to roll back the nation's ethanol usage mandate, according to the DesMoinesRegister.

Demand for grain to make ethanol is raising the price of chicken feed and ultimately the cost of chicken and that's "causing undue hardship" for a chain that sells chicken wings, Flynn said.

His complaint is among more than 15,000 comments that were filed recently with the Environmental Protection Agency after Texas Gov. Rick Perry asked the Bush administration to cut the ethanol mandate in half. Under the 2007 energy bill, refiners are required to use 9 billion gallons of ethanol this year.

The proposal has pitted restaurant chains, food processors, meatpackers and livestock farms against interests that benefit from ethanol production - corn growers and ethanol producers - and one less obvious ally, the auto industry.

The mandate's opponents are warning of tough times for livestock farms and consumers if the mandate isn't rolled back. But whether their predictions of "undue hardship" on fast-food customers or farm bankruptcies will be enough to get the mandate cut is another matter.

The law sets a high bar for the mandate's critics. It can be waived only if the Environmental Protection Agency decides there is an inadequate supply of ethanol - hardly likely because production is expected to reach 9 billion gallons this year - or if the mandate would "severely harm the economy or environment" of a state, a region or the entire nation.

The American Meat Institute, which represents packers, said it does - by contributing to food-price increases.

The National Pork Producers Council, arguing for the mandate cut, said the impact of rising corn prices on the pork industry and its customers in Texas and nationwide "will be devastating as herds are culled, producers go out of business, and prices skyrocket."

View the DesMoinesRegister story by clicking here.