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Senators urge action to close ethanol import loophole
U.S. Senator Tom Harkin (D-IA), ranking Democrat on the Senate Agriculture, Nutrition and Forestry Committee, was joined by Senators Mark Dayton (D-MN) and Byron Dorgan (D-ND) recently in urging Senate action to address a plan by Cargill, Inc. to import Brazilian ethanol through El Salvador tariff-free. The senators sent a letter to Senate Finance Committee Chairman Senator Charles Grassley (R-IA) and ranking Democrat Senator Max Baucus (D-MT), because that committee has jurisdiction over such trade matters.
At question is a provision in legislation known as the Caribbean Basin Initiative (CBI). The CBI would currently allow Cargill to build an ethanol dehydration facility inEl Salvador through which they would remove a modest amount of water from Brazilian ethanol and export it to the United States tariff-free. The senators are concerned the proposed plan by Cargill may disrupt domestic ethanol producers' long-term plans for expansion and "ultimately outsource Midwestern jobs to Brazil and El Salvador to supply the U.S. ethanol market."
"We must act, and act swiftly, to prevent this setback to our ethanol industry and the ultimate outsourcing of jobs from ruralAmerica," said Harkin. "The ethanol industry has been one shining star in an otherwise gloomy economic sky in rural America. To allow Cargill to undermine the progress we have made with regard to ethanol production and use would be a disservice to farmers, ethanol producers and all of rural America."
The senators have called for the immediate introduction of legislation to close this loophole as well as for a hearing very soon to get this issue resolved as quickly as possible.
Date: 7/20/04
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