DES MOINES — Ethanol and biodiesel supporters say the outlook for their products is bright for 2012, but there are potential clouds on the horizon.

That was one of the big messages at this past week’s Iowa Renewable Fuels Summit, an annual gathering of renewable-fuels leaders.

Ethanol and biodiesel makers increased production and profits in 2011, noted Monte Shaw, executive director of the Iowa Renewable Fuels Association.

They are primed to have a good 2012. But, they are also fighting to keep lawmakers from eliminating the federal renewable fuels standard (RFS), to get Congress to renew a tax incentive for biodiesel and to open the market for E15 fuel blends.

One irony is livestock producers and some national livestock groups have helped lead the push against ethanol, arguing it increases corn prices and feed prices.

Shaw said that is a hypocritical argument because USDA figures show corn prices were below the cost of production for 22 out of 25 years from 1981 to 2005.

This means only a multi-billion dollar federal farm program kept farmers in business producing corn for many of those years, he added, and livestock producers in parts of the country that do not produce much corn were really being subsidized during that era.

That is one of the reasons some livestock production left the Midwest and went to places, such as Texas, North Carolina and California during that time, Shaw said.

Iowa livestock groups understand the importance of ethanol, noted Matt Deppe, executive director of the Iowa Cattlemen’s Association.

They also know the value of dried distillers grains as a feed product.

Meanwhile, Shaw says large oil companies continue to fight ethanol and other renewable fuels, suing to eliminate the RFS and trying to block the introduction of E15.

Shaw says it is up to farmers and industry leaders to educate consumers and lawmakers about renewable fuels. One thing he tells them is there is no mandate everyone use ethanol.

Instead, he said there is a mandate that at least 90 percent of the bulk of fuel sold in the country is oil.

Federal law requires any fuel put in a vehicle be first approved by the EPA, but gasoline was grandfathered into the system, he explained.

This makes it extremely difficult for any new fuel mixture to gain market access.

One thing that would change that picture and somewhat level the playing field is to mandate every car sold in the country be a flex-fuel vehicle, said Gal Luft, executive director of the Institute for the Analysis of Global Security (IAGS), a Washington think tank focused on energy security.

Luft says a bill (the Open Fuel Standard Act) has been introduced that would make such a mandate law, but it doesn’t have the backing to pass.

Such a move would increase the price of a vehicle by only a small amount, perhaps as little as $70 per vehicle, he said. But, it would change the outlook for all renewable fuels immediately.

Auto companies are against it, saying they don’t like mandates, but Luft said the real reason probably has more to do with fears it could cost those companies some of the fuel efficiency credits they get for producing a small number of flex-fuel vehicles now.

He also notes very few companies make their smaller, high-mileage vehicles into flex-fuel models, despite the fact flex-fuel vehicles are made for markets, such as Brazil.

The move would allow consumers to make choices, Luft added.

“Let me decide but give me a platform that allows me to make choices,” he said.

The argument on energy shouldn’t really be about imported energy, Luft argued. It should be about oil. Oil is an international commodity.

So long as the United States is dependent on oil, it will be dependent on oil-producing nations that don’t always like us because those nations will always find a way to influence the price of oil, he said.

So, the renewable fuels industry has challenges before it: It wants to keep the RFS, to allow the use of E15 in non-flex-fuel vehicles and to get more flex-fuel vehicles.

But, the industry is growing, and it is profiting. Also, farmers, who sell corn to the fuel producers and often buy feed products back from them, are benefiting as well, Shaw says.