Issues & Advocacy

Issue Brief

Commodity and Ethanol Programs

Food costs are one of the biggest line items for restaurants, representing about a third of every restaurant sales dollar.

Since its inception in 2005, the Renewable Fuel Standard has caused food costs to rise. This has severely challenged our nation’s restaurant operators and the millions of customers they serve each day.

Food costs are one of the most significant line items for restaurants, representing about a third of every dollar in restaurant sales. As the price of corn increases, a ripple effect of price increases occurs across every food in the supply chain.

Average wholesale food costs increased 25 percent from 2009 to 2014, in part due to the RFS. A PricewaterhouseCoopers study concluded that the RFS mandate increases costs for chain restaurants on food commodities by $3.2 billion annually.

The Renewable Fuel Standard is broken and failing to achieve its stated goals. It’s time for Congress to repeal it immediately to lower food costs and provide relief to restaurants and their customers.

The Facts

  • In 2005, Congress established the Renewable Fuel Standard, which mandates that increasing volumes of renewable fuels be blended into gasoline annually.
  • By shifting corn crops to ethanol production rather than food or feed, the RFS has caused food prices to rise dramatically. In recent years, approximately 40 percent of the U.S. corn crop has been processed into ethanol and away from food or livestock feed.
  • At the same time, there’s little evidence the RFS has delivered on its promises to help move the U.S. toward energy independence and lower fuel emissions.

OUR ASK: Support legislative efforts to repeal or reform the Renewable Fuel Standard.

Contact Laura Abshire
Director, sustainability policy
labshire@restaurant.org (202) 973-3964