Once again, U.S. farmers and ranchers are suffering financially from unintended effects of government policy. Energy policy, or lack thereof, is at the heart of the matter. At this writing, fuel industry analysts are forecasting high price spikes in gasoline and diesel this summer. Consider, too, the price of natural gas (the primary component in manufacturing anhydrous, urea and other nitrogen products) has been extremely volatile 4 out of the past 5 years.

Agriculture's pain, however, is not simply a matter of higher fuel or anhydrous prices. Farmers (as well as most consumers) pay increased energy costs. Unlike consumers, farmers have direct costs in irrigation, grain drying, crop protection and factors directly affected by unstable prices. According to Farm Bureau, farm input costs increased 30 to 40 percent this past season as a result of energy costs. USDA estimated a 2003 growing season increase of $2.6 billion associated with higher energy prices.

The United States needs a national energy policy to stabilize costs. We have a historic opportunity to build one now. One look at the economic situation today underscores the seriousness. From agriculture's perspective, several excellent ideas include ethanol and biodiesel. The Biodiesel Tax Incentive and the Renewable Fuels Standard, both of which are designed to increase the use of "home-grown" fuels, were included in the U.S. Senate-passed federal highway reauthorization bill. Both go a long way toward helping shape a coherent national energy policy. But it's not a done deal yet. It should be.

MFA Oil has said for years that alternative fuels are good for the environment, decrease our dependence on foreign oil and bring value to our customers. They also have potential to give an economic boost to farmers. As Jerry Taylor, MFA Oil's CEO, says, what's good for farmers and the rural economy is good for the community, for the economy of cities, for the economy of the state and ultimately, for the economy of the nation. Home-grown fuels are an essential component of a national energy policy.

One of MFA Oil's core strategies is to be the renewable fuel distributor in the marketplace. MFA Oil Company was an early, enthusiastic supporter of home-grown fuels. In fiscal year 2003, MFA Oil sold more than 8 million gallons of soy biodiesel and is on its way to doubling that feat this year. The company also sold 6 million gallons of ethanol-blended gasoline in 2002 but expects to sell 65 million gallons (2.4 million bushels of corn) this year. But, home-grown fuels are only one piece of the national energy puzzle.

This past February the chief executive officers of 20 major chemical and plastics companies wrote a letter to the Bush administration and the congressional leadership asking for a concerted national effort to stabilize the natural gas market. I would have gladly added my signature to that document.

The signers of this letter described current market volatility and abnormally high natural-gas prices as "the equivalent of a $111 billion tax on the economy over the past 18 months." Specifically, these industry leaders pointed out that today's industry norm of volatility and price spikes is the result of federal policy promoting use of natural gas while simultaneously discouraging production. The reference, of course, is to provisions of the federal Clean Air Act which has fueled demand for natural gas over coal. U.S. power plants under construction and on the drawing board are almost exclusively designed to burn natural gas. Additionally, over the last decade the federal government has increased regulation on natural gas exploration, drilling and production. Many potentially productive areas are off limits completely.

The irony here is that North America has vast amounts of untapped natural gas. The United States is second only to Russia in natural gas production. Most of the supply comes from the Southwest. Unfortunately, most of today's fields were developed in or around the 1950s. We need additional exploration to develop additional wells.

According to the natural gas industry, the U.S. government owns just shy of 30 percent of the total U.S. land mass. Much of that is off limits to development. But an estimated 40 percent of the undiscovered natural gas is speculated to exist on this land. At the same time, production companies have been prohibited access to virtually all federal lands offshore the Lower 48 states. Much of the Rocky Mountains is off limits, and access to another 32 percent is significantly restricted.

There are encouraging signs, however. Right now, according to the Associated Press, the Bush administration is set to encourage natural gas production in the Gulf of Mexico. In fact, U.S. Secretary of the Interior Gale Norton announced incentives to develop domestic natural gas supplies. Those incentives are expected to triple natural gas drilling permits in Wyoming and encourage natural gas production in the Gulf of Mexico. The department estimates these incentives will result in an additional 56 trillion cubic feet of natural gas, helping stabilize U.S. energy prices and saving consumers $570 million annually.

These efforts are laudable, but they are only part of what remains lacking: a unified, defined national energy policy. I hope all of you will help convey that message to our senators and representatives. Agriculture will benefit. So will our nation.