Ethanol tax credit, tariff raise corn prices by 18 cents per bushel: FAPRI

In Michigan, economists at the MU Food and Agricultural Food and Policy Research Institute (FAPRI) ran ‘what if’ scenarios on both the current 45-cent tax credit for biofuel blenders and associated 54-cent tariff on ethanol imports and found that extending them would boost corn-based fuel production and corn prices. With incentives in place, they saw fuel production from corn go up 1.2 billion gallons a year and corn prices rise 18 cents per bushel. Increased demand for corn as an ethanol fuel source would expand corn acreage by 1.7 million acres.