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Ethanol waiver impact on livestock seen as limited

08/15/2012 @ 8:39pm

Livestock producers hoping a federal waiver of the ethanol mandate will alleviate the pain of high corn prices may be disappointed, Iowa State economist Bruce Babcock says. Babcock said that based on current ethanol and gasoline prices, "the price of ethanol will be supported at quite an attractive level" regardless of the mandate, which would keep the ethanol industry a key force in the corn market.
 
He added that a waiver would lower corn prices by 7.4%, but that would still leave prices historically high. If U.S. ethanol consumption were somehow banned entirely, corn prices would drop all the way to an average of $2.67/bushel, Babcock said.
 
September CBOT corn rose 7 1/4c to $7.87/bushel on Wednesday.
 
 (ian.berry@dowjones.com; @enberry)

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(END) Dow Jones Newswires

August 15, 2012 12:06 ET (16:06 GMT)

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