“GMA supports the goal of reducing our nation’s reliance on fossil fuels and applauds Congress and the Bush Administration for their efforts to increase the use of alternative forms of energy, including an increase in the use of biofuels. However, America’s biofuels policy should be pursued thoughtfully and deliberately, taking into full account the possible unintended consequences of a sharp increase in the use of corn for fuel.

“For instance, we support policies that will permit an increase in biofuels production without hampering the ability of the food industry to provide consumers – both in the U.S. and around the world – with a reliable and affordable supply of food.

“Consumers have already seen an increase in the cost of food, as corn traditionally used for livestock feed and processed food is increasingly used for fuel. In fact, the price of corn has nearly doubled in the last nine months.

“In addition to its inflationary impact, there are many unintended, but nonetheless important, consequences of an ambitious corn ethanol strategy. For example, a 35 billion gallon ethanol mandate will require a substantial increase in the use of fossil fuels for corn and ethanol processing and transportation, as well as an additional fifteen million acres devoted to corn crops, which will encroach on agriculturally marginal and environmentally sensitive land.

“An aggressive ethanol mandate will also require the U.S. to significantly reduce its corn exports to ensure an adequate supply of corn for food and fuel. Such a reduction will result in a decrease in the amount of food available overseas, which in turn will have a negative effect on world hunger.

“At a time when the food industry is working with international, federal and state experts to reduce the use of trans and saturated fats used for cooking and baking, a rapid increase in the number of acres dedicated to corn would negatively affect our ability to provide the public with healthier alternatives. Acres currently used to grow soybeans and other crops that produce healthier oils would instead be used to grow corn.

“It is also important to note that the potential health benefits of an increase in the use of ethanol are in doubt. A recent Stanford University study warned that an increase in the use of ethanol might result in an increase in respiratory-related deaths and illnesses.

“We urge Congress and the Administration to undertake a comprehensive study that evaluates the full impact – including any and all unintentional consequences – of expanding the use of biofuels. Such a study will enable policymakers and the public to make fully informed decisions when it comes to our nation’s energy policy.

“In addition, GMA supports a broad-based approach to alternative fuels that includes the increased use of cellulosic ethanol, the elimination of the fifty-four cents per gallon tariff on ethanol imports and the expiration of the taxpayer-funded fifty-one cents per gallon ethanol subsidy.

“The adoption and implementation of these proposals will encourage further diversification of our nation’s energy supply, restore predictability and balance to the corn market and maintain the ability of the food industry to provide its consumers with a reliable and affordable food supply.”

The Grocery Manufacturers Association (GMA) represents the world’s leading food, beverage and consumer products companies. The association promotes sound public policy, champions initiatives that increase productivity and growth and helps to protect the safety and security of the food supply through scientific excellence. The GMA board of directors is comprised of chief executive officers from the Association’s member companies. The $2.1 trillion food, beverage and consumer packaged goods industry employs 14 million workers, and contributes over $1 trillion in added value to the nation’s economy. For more information, visit the GMA Web site at www.gmabrands.com.

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