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National Restaurant Association - EPA proposes lowering biofuel-blending requirement

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EPA proposes lowering biofuel-blending requirement

The Environmental Protection Agency has proposed lowering the amount of biofuel—including corn-based ethanol—that must be blended into gasoline under the Renewable Fuel Standard, a move the National Restaurant Association called a step in the right direction toward legislative changes to the RFS, which has been partly to blame for higher corn prices.

The EPA’s proposal would decrease the amount of biofuel from the current 16.55 billion gallons to 15.21 billion gallons, a decrease of 1.34 billion gallons. This would bring the biofuel-blending requirement back to 2012 levels and would be the first ever-reduction in the biofuels mandate. 

The NRA, which opposes the corn-based ethanol requirement of the federal RFS, endorsed the move, but said more action is necessary.

“The availability and affordability of corn is a vital component to U.S. food production,” said Scott DeFife, NRA executive vice president, policy and government affairs. “While this proposal is a positive step forward, more needs to be done in order to ease pressure on corn and food prices. Lowering the biofuel-blending target would benefit consumers, businesses and the overall economy by helping to lower these costs, and Congress should continue to explore structural changes to the program through legislation.”

Wholesale food costs have increased nearly 30 percent over the past six years, which the NRA attributes in part to the corn-based ethanol mandate in the RFS. Last year, 40 percent of U.S. corn crops were devoted to fuel production, rather than food or feed.

“Food costs are a top business challenge for the restaurant industry, representing about one-third of restaurant costs,” DeFife said. “As a result, fluctuations in food and commodity prices significantly impact restaurants’ bottom lines.”

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