Farmers, Engineers, Contractors, Educators and Activists Call for FTC Stop to Big Oil Bid for Alcohol Fuel Market Control

SANTA CRUZ, Calif., Feb. 23 /PRNewswire-USNewswire/ — International
Institute for Ecological Agriculture (IIEA) announced today that its members
have launched a campaign to communicate public outrage and opposition to the
Valero bid to acquire the assets of bankrupted independent Ethanol producer
VeraSun. IIEA executive director and renewable biofuel expert, David Blume noted that Valero’s offer clearly demonstrates the end-game strategy for last
year’s aggressive Food vs. Fuel propaganda and price war manipulation campaign
implemented by the International Oil cartel. The campaign is systematically
engineering the collapse of America’s fledgling independent renewable fuel and
energy producers market.

In a December 2008, media alert Blume stated that the real benefactors of
currently lower heat and transportation fuel prices were the major Oil
companies and that, “Many investor-backed as well as entrepreneurially driven
Alcohol plants currently producing in the U.S. will be forced out of business
by the middle of 2009.” Blume observed that “40 of the nearly 200 alcohol fuel
plants we have working across the country now have been victimized by Big
Oil’s slash, burn, and buy strategy to collapse, consume and control our
fledgling alcohol fuel industry.”

Declaring bankruptcy recently in a Federal Court in Delaware, VeraSun
represents a considerable setback for the Alcohol Fuel industry. Having fallen
from the vanguard of ethanol producing plants funded by venture capital, its
collapse is having a riptide effect through the investment and farming
community as well. Once a mighty force for alcohol expansion, VeraSun is now
reduced in value to pennies on the dollar.

Through a gaming of the commodities futures trading system, predicted in
Blume’s best-selling book Alcohol Can Be A Gas, big money influences have been
able to artificially drive the price of corn up while depressing the price of
alcohol fuel. The impact of artificially high corn prices, at a time of record
surplus, is that plants like VeraSun (that aren’t farmer-owned cooperatives,
but rather investor driven businesses) are forced to pay high prices to
compete with projected future market demand for corn. Meanwhile, the futures
price of alcohol was driven down by Big Oil’s fuel monopoly — as collectively
Big Oil buys over 99% of alcohol fuel produced.

While VeraSun and the future of other independent distillery companies
face market failure, the real market losers are America’s farmers. Gas today
is selling for over $2.00 a gallon across the country and though considered
inexpensive by some, current prices reflect a 50% increase since December 19th
2008, and even though gas prices dropped, farmers were faced with a
quadrupling of prices for oil-based products such as fertilizers and
pesticides.

For the first time ever the Federal court ruling in the VeraSun bankruptcy
stands to set a legal precedence that would allow oil company buyers to reject
contract commitments for grain and corn purchases VeraSun made with working
farmers in advance of the coming year’s crop.

The problem with this is, farmers have already borrowed money (based on
futures pricing) to pay for higher input costs in producing the supposedly
higher-priced corn. Unlike the plant owners, farmers won’t get to avoid their
debts and is now apparent, Oil companies are in a position to swoop in and buy
up the alcohol plants, reject the futures contracts, bankrupt the farmers, and
then be able to buy their land.

“If the oil companies gain control of even a quarter of the alcohol
production infrastructure and land for the crops, there will be no end to the
disruption they can cause in markets,” Blume continued. “If you think that
it’s a nightmare that Big Oil controls our energy, think what life would be
like if it controlled our land and food, as well.”

Blume is an advocate for smaller alcohol fuel plants but feels it is
imperative to protect the larger independent plants as well for the health of
the U.S. economy. Along with a number of farmer, consumer and renewable energy
groups, Blume is calling for the implementation policies that will ensure the
alcohol fuel industry’s long-term growth and stability programs include:

— All alcohol fuel plants should be given low cost loans to install
the equipment necessary to handle non-corn energy crops.

— By 2010 plants should be required to diversify their crop inputs,
limiting corn to 50% of the total.

— By 2011 all plants should be required to run at least 90% on renewable
fuel, not fossil fuels. Corn Plus has already converted its plant to run on
biomass, reporting a 6:1 energy return compared to the usual 1.5:1 of coal-
based alcohol fuel plants.

— Provision of loans to provide energy to alcohol fuel plants using
biomass-fired combined-heat-and-electricity facilities. This would reduce
alcohol price volatility, since alcohol production would largely be decoupled
from the prices of oil, coal, and natural gas.

— An additional 50cent per gallon tax credit should be provided to plants
producing less than 5 million gallons per year to encourage a diversity of
alcohol plants using locally grown energy crops.

Blume calls for citizens everywhere to contact their Congressional
representatives, the Department of Justice, Antitrust Division -
http://www.usdoj.gov/atr/contact.html and the Federal Trade Commission, Bureau
of Competition antitrust@ftc.gov to express their concern regarding the Valero
acquisition of VeraSun and to help mandate protectionary and regulatory
programs for the formation of a truly independent renewable energy and fuel
producers market. (Note: email is not secure. Mark confidential information
“Confidential” and send it via postal mail).

For a copy of Blume’s Slash & Burn article or for more information about
IIEA or David Blume please contact: Tom Harvey, theCommunications,
(530) 257-3533, thcommunications@gmail.com, or visit www.alcoholcanbeagas.com

SOURCE International Institute for Ecological Agriculture