ND Department of Agriculture
Comments

August 28, 2000

Alex King
Acting Deputy Administrator
Commodity Operations
Farm Service Agency
U.S. Department of Agriculture
STOP 0550
1400 Independence Avenue, SW
Washington, DC 20250-0550

Re: Docket 00-18709, "Bioenergy Program"

Dear Mr. King:

We would like to thank the United States Department of Agriculture (USDA) for the opportunity to comment on the proposed rule for the Bioenergy Program (Federal Register/ Vol. 65, No. 145, Thursday, July 27, 2000, pgs. 46115-46119).

We strongly support USDA’s announcement and initial rulemaking of the Bioenergy Program, as it will provide incentives that will encourage increased usage of domestic agricultural commodities, such as corn, and will bolster a very important value-added market for farmers in North Dakota and throughout the country.

The list of eligible commodities for which cash incentives can be paid if such commodities are used in bioenergy production should be expanded to include sugar.

North Dakota’s two ethanol production facilities – Alchem and ADM - have production capacities of approximately 12 million gallons and 24 million gallons respectively. We are in general agreement with your proposal, which targets program incentives to small producers – those which have a maximum production level of 30 million gallons annually.

However, we would urge USDA to clarify the issues raised by the Renewable Fuels Association and National Corn Growers Association in their comments and to assess the current and near-term production levels of "small producers" to determine if the definition enacted 10 years ago reflects the needs of the industry.

We believe it is important for small, farmer-owned ethanol producers to participate to the greatest degree possible in this program. Therefore, we urge you to structure payment eligibility and incentives with that in mind.

Rural America will benefit from opportunities, such as this Bioenergy Program, which will encourage value-added agriculture and increased use of local agricultural commodities and products. We need to continue to work to develop valued-added industries throughout agriculture and this program may very well serve as a model for future incentive programs.

Thank you for the consideration of our comments. We strongly support the Bioenergy Program and look forward to working with you on this and other programs in the future.

Sincerely,

Roger Johnson                                                     Mike Clemens
Commissioner                                                      President
ND Department of Agriculture                             ND Corn Growers Association

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