The Grocery Manufacturers Association, the American Meat Institute, the National Restaurant Association and other groups say rising corn-based ethanol production is pushing food costs higher. Adding industry muscle to fight a federal requirement to about double ethanol production to 15 billion gallons by 2015 may slow the increase, helping company profits and easing consumer prices, said grocery association chief Cal Dooley.
"We are calling on Congress to step back and re-evaluate our biofuels policy, which is distorting the marketplace and harming the environment and consumers,"Dooley, a former Democratic congressman from California, said in an interview before the campaign was officially unveiled today.
Dooley said the coalition will try to persuade members of Congress to relax ethanol-use rules, reduce tax credits for U.S. ethanol blenders and lower a tariff on ethanol imports.
The GMA, which represents Kellogg, the largest U.S. cereal maker, and Kroger, the largest food-store chain, as well as Coca-Cola, Kraft Foods and ConAgra Foods, and the other groups may also buy advertising to get their message across, he said.
Ethanol may contribute as much as 25 percent to the faster-than-usual gain in U.S. food prices, the Department of Agriculture has said. U.S. food inflation may be 5.5 percent this year, the highest rate since 1989, the department said last month.
