EU drops US bioethanol trade investigation

A document seen by Reuters determined that the United States was no longer subsidizing bioethanol and that the commission had determined that retaliatory action “would not be appropriate at this stage.” 

According to a source, the case could be dropped entirely unless the United States were to reintroduce the ethanol blender’s tax credit sometime within the next six months.

The United States allowed an ethanol excise tax credit to expire this year, eliminating a 45-cent subsidy per gallon of corn ethanol mixed with gasoline. 

The subsidy had been under fire from environmental and financial watchdogs for years, totaling approximately $6 billion annually and $30.5 billion during its lifetime, according to Sen. Tom CoburnThomas (Tom) Allen CoburnMr. President, let markets help save Medicare Pension insolvency crisis only grows as Congress sits on its hands Paul Ryan should realize that federal earmarks are the currency of cronyism MORE (R-Okla.). 

Prices for corn this year have been particularly high due to a stubborn drought that affected much of the country and raised concerns about bioethanol use.