University Economic Studies Show Waiving RFS Would Have Negligible Impact on Corn Price

In Washington, two separate studies released this week by Iowa State University and Purdue University, directly refute the suggestion from livestock and poultry groups that waiving the US Renewable Fuel Standard would dramatically reduce corn prices and increase availability. The Purdue University analysis showed that the flexibility built into the RFS—namely the ability of refiners to use excess RIN credits accumulated in past years—serves to reduce corn price without a waiver being necessary. However, the Purdue economists found, if Environmental Protection Agency (EPA) did waive the RFS, corn prices might decrease further by approximately 5.6% in 2013.

Meanwhile, the Iowa State University analysis, an update to an earlier report, found that fully waiving the RFS would result in just a 7.4% reduction in corn price in the 2012/13 marketing year.