Source: Lisa M. Keefe, MEATINGPLACE, 9/10/14

In recent public appearances, the head of the Environmental Protection Agency, Gina McCarthy, has indicated that when the ethanol mandate is handed down later this year the levels will be higher than had been previously targeted.

Gasoline consumption has gone up in the last year, and so previous projections that set the Renewable Fuel Standards lower to account for a reduction in gas usage are now too low, McCarthy told the Barclays CEO Energy-Power Conference earlier this month, and the National Farmers Union fly-in in Washington, D.C., this week.

One analyst told Bloomberg/Businessweek that he estimated the ethanol quota will land at about 13.6 billion gallons, up from a target of about 13 billion gallons under a proposal that the EPA announced last year.

As consumers cut back on gasoline use, oil and gas companies complain that mandated amounts of ethanol that are to be blended into the fuel are too high. Corn farmers have pushed back on reductions, however, characterizing the move as one meant to curry favor with the oil companies.

As corn is diverted to ethanol plants, however, feed supplies for livestock can get tight and the prices goes up. The corn crop for 2014 looks to be a record-breaking bumper crop, but in 2008 the price of corn rose as high as about $8 a bushel, with ripple effects throughout the meat supply chain.

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