WASHINGTON (Reuters) – Agriculture Secretary Ed Schafer said ethanol is not having a "major" impact on food prices, and downplayed calls by lawmakers and industry groups to make changes to programs that promote increased use of biofuels.
Prices for wheat, corn, soybeans and rice have set record highs at the Chicago Board of Trade this year. Around the world, rising food prices have lead to hoarding of wheat and rice, bread lines and food riots.
It has prompted demands from some to pull back the throttle on the boom in ethanol and other biofuels, touted as a home-grown way to reduce U.S. reliance on foreign energy.
In Congress, two dozen Republican senators have pushed to revisit a mandate passed last December that calls for a fivefold increase in biofuels output by 2022.
Schafer told reporters that demand for biofuels is having an impact on food prices, "but it is not a major factor."
He said there would be few benefits from changing the renewable fuels standard, reducing the tax credit for producing ethanol as proposed in the farm bill or ending the ethanol import tariff.
"The change in the renewable fuel standard, the change in tariff or duty isn't going to affect food prices," said Schafer. "We need to focus on things that will actually have an effect instead of a short-term political solution."
The Grocery Manufacturers Association, echoing concern in the food industry and from aid groups, earlier this month blasted the growing use of corn to make fuel that is driving up the cost of virtually all commodities.
