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Waiving RFS wouldn't affect corn prices much

Reducing the renewable fuel standard would have only a small negative effect on corn prices, according to a study released Thursday by the Food and Agriculture Policy Research Institute at the University of Missouri.

FAPRI conducted the study in response to a request from the USDA Office of the Chief Economist. Oil and meat groups have said the drought and high feed costs are reasons to waive the RFS. Several governors have asked the Environmental Protection Agency to waive it and bills on it have also been introduced in Congress.

Renewable Fuels Association President Bob Dinneen noted in a news release that the study found that corn prices would fall less than 1 percent and that ethanol production might fall by only 1.3 percent, and that corn available for livestock feed might increase by 0.6 percent.

“The new FAPRI study is just the latest in a series of recent reports that show waiving the RFS would not have the types of impacts claimed by the livestock groups and grocery manufacturers,” Dinneen said.