The ethanol industry owes its existence to government subsidies, and now producers of the alt-fuel want more tax dollars.
DomesticFuel.com: Ethanol plants that have been hurt by dramatic fluctuations in commodity prices this year could be eligible for assistance from the US Department of Agriculture.
Secretary of Agriculture Ed Schafer told reporters after an address to the World Food Prize breakfast in Des Moines Friday that “some plants are under pressure because they’ve been speculating on corn.”
Some ethanol companies, most notably VeraSun, speculated on corn prices during the summer and locked in prices when corn was at $7 per bushel and now cash prices are about $3.50 per bushel, causing some significant losses. “There is going to have to be some credit applied to companies to buy some lower-priced corn to blend with their higher-priced corn obligations,” Schafer said.
This is nonsense. A good thing to come out of the economic slowdown, at least for consumers, has been the drop in commodity prices. Now taxpayers are being asked to bail out companies that have been hurt by the fall. You can tell taxpayers are getting hosed, by looking at the response from those in the industry, commenting on the above article:
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