U.S. Farm Earnings Drop 14.6 Percent In Third Quarter AFter A Decline In Output

Just as the debate over mandated ethanol blending in the US was heating up, the Associated Press published an investigative report focused on the US ethanol industry’s negative environmental impacts. Ethanol supporters are up in arms, claiming the piece is inaccurate, lazy journalism that uses “disproven myths, skewed data, and outright fabrications.” Not surprisingly, US petroleum refiners claim they have raised these points for years and the high-profile message sent by the AP investigation is long overdue.

Interestingly, the AP article came out at a time when refining interests were making a strong push to repeal or alter the law that mandates US ethanol blending volumes, known at the Renewable Fuel Standard. “I do think it’s fortuitous that it [the AP investigation] comes out when we’re waiting for EPA to release the 2014 numbers. I don’t think it will have an impact, as this has been in the works for a long time. The rumor is that it might even come out today,” Charlie Drevna, American Fuels & Petrochemicals Manufacturers President told Breaking Energy.

The Renewable Fuels Association, a major ethanol producer trade group, is extremely displeased with the article and stated they spoke with the AP reporters, but were ignored in the piece. “The lead reporter responsible for the story interviewed RFA staff on multiple occasions. RFA provided indisputable facts, peer-reviewed studies, and government data documenting ethanol’s positive impacts. Yet, the AP consciously chose to ignore this material and instead opted to publish a salacious and terribly unbalanced account of the effects of corn production and ethanol on the environment,” RFA said in a statement.

The AP investigation found that millions of acres of conservation land was encroached upon to plant corn and pollution from agricultural runoff impacted rivers and the Gulf of Mexico. “As farmers rushed to find new places to plant corn, they wiped out millions of acres of conservation land, destroyed habitat and polluted water supplies,” the AP said in the article.

As we mentioned yesterday, the RFA held a fact-checking webinar yesterday afternoon to dispute claims made in the AP investigation. “There’s probably more truth in this week’s National Enquirer than there is in the AP story,” the Renewable Fuels Association’s Geoff Cooper is quoted as saying on a Monday press call. RFA released this document disputing claims made in the story.

For background on the ethanol blending debate, read Breaking Energy coverage here, here, and here

The AP said this today in a statement responding to the backlash:

“In an unusual campaign, ethanol producers, corn growers and its lobbying and public relations firms have criticized and sought to alter the story, which was released to some outlets earlier and is being published online and in newspapers Tuesday. The Agriculture secretary, Tom Vilsack, told the Des Moines Register that the AP project included “a number of inaccuracies and errors.” Vilsack said farmers were engaged in other conservation practices, including wetland reserve programs, wildlife habitat incentive programs and EQIP, a program that helps farmers adopt conservation practices.

The industry’s efforts, which began one week before the AP project was being published and broadcast, included distributing fill-in-the-blank letters to newspapers editors that call the AP’s report “rife with errors.” Industry officials emailed newspapers and other media, referring to AP’s report as a “smear,” ”hatchet job” and “more dumpster fire than journalism.”

“The AP’s reporting on this important topic is a result of months of work and review of documents, and interviews of experts and people on all sides of the public policy debate about this energy resource,” said Mike Oreskes, AP’s vice president and senior managing editor. “We stand behind our reporting and welcome further insights and discussion.”

The US refining industry is clearly sympathetic to the investigation’s findings. “We’re not dancing a jig, but saying there is a real problem out there and it needs to be fixed. Whether it’s AFPM, environmental groups, food groups or restaurants, there’s a huge ball of entities questioning this. We’re waiting for EPA to perform triage because the patient needs help now, he needs to go to congress to get invasive surgery,” Drevna told Breaking Energy.

“We’re not saying ‘I told you so’, but why not.”