24 November 2008 22:07 [Source: ICIS news]
HOUSTON (ICIS news)--The US ethanol industry on Monday resumed its attack on the US food industry, accusing food companies of not passing through savings to US consumers despite a sharp drop in corn prices.
“To deflect attention from their own actions …large food companies are misleading the public by blaming…ethanol production for the higher cost of Thanksgiving dinner,” the Renewable Fuels Association (RFA) said.
The RFA said US food prices in October were 6.3% higher than a year ago notwithstanding a slump in US corn prices since the summer.
Corn prices have dropped by 21% from $4.28/bushel on 21 November 2007 to $3.39/bushel on the same day this year, the RFA said, noting that prices referred to December 2008 futures.
Corn hit a peak of near $8/bushel in end-June.
“While millions of Americans give thanks for lower gasoline prices…they won’t be voicing gratitude for the higher price of a typical Thanksgiving dinner,” the association said.
The latest statement is part of a campaign by the US ethanol industry to fight back claims that its growing demand for corn is costing US consumers millions more at the grocery store.
The RFA and the US food industry have been exchanging fire since early 2008.
Food makers blame corn-based ethanol for higher corn prices, while the ethanol industry claims speculators and drought are actually responsible for the rally in the price of the feedstock.
The American Grocery Manufactures Association (GMA), which represents the US food industry, could not be immediately reached for comment.
However, the Food Before Fuel Campaign group, of which the GMA is a member, downplayed the claims made by the RFA.
“This is just a reaction to an event we held last week to oppose 30 years of ethanol subsidies,” a spokesperson said.
The group as well as the GMA are calling on Congress to phase out subsidies for the US ethanol industry and to reconsider US fuel ethanol mandates.
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