Missouri team finds that dropping all ethanol mandates, subsidies and tariffs would drop corn price by one half-penny per ear

A team at the University of Missouri’s Food and Agricultural Policy Research Institute, modeled the impact of corn prices of letting the ethanol tax credit of the ethanol tariff expire. They found that, over the 2011-18 period, the average corn price would fall by 0.6% if the credit was discontinued and 2.8 percent if the tariff was repealed.

FAPRI found that reducing the ethanol mandate by 1 billion gallons would reduce corn prices by 1.0 percent, or about 4 cents a bushel at today’s prices. The team found that if all corn ethanol madates, tariffs and credits were removed, production would fall by 5.5 billion gallons and the price of corn would drop by 13.1 percent, or around 55 cents a bushel – around a half a penny per ear of corn.

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