CHIPPEWA FALLS, Wisc. (WEAU) - Despite some rain this week, drought conditions leftover from this summer have lead to higher corn prices and a debate over ethanol.
The government requires about 13 billion gallons of ethanol to be used in the nation's gasoline, making this year’s crop even smaller after the drought.
With a push from meat producers to end the requirements, Wisconsin Corn Promotion board member and Chippewa Falls corn and dairy farmer Randy Woodruff said those costs aren't as bad as many think.
"When it does go for ethanol, in the process, it's only pulling the starch out. The rest comes back as a high protein feed additive for livestock," Woodruff said. "What causes the food prices to go up is transportation costs."
A 2011 study by the University of Wisconsin and Iowa State said using ethanol reduced gas prices by more than a dollar a gallon, but the Wisconsin Minnesota Petroleum Council said high ethanol costs bring gas prices up.
"Experts attribute four to five cents a gallon at the pump directly to ethanol prices," Council Executive Director Erin Roth said. "Ethanol does contribute to higher gas prices."
Woodruff disagreed. "Without ethanol, I think you'd see a lot higher gas prices," he said.
Whatever its effect may be, Woodruff said cutting ethanol would also mean cutting jobs, and that suffering farmers will bounce back.
"With our technology, we're producing more food each year, so I think it's a good time every year to be a farmer," Woodruff said.
Roth said waiving the federal ethanol requirements would be a long process with a lot of opposition.