Blaming ethanol's negative image connected with subsidies and increased production on "Big Oil" and "Big Grocery," he believes that food manufacturers have used ethanol as a scapegoat to raise food prices, and that oil companies have their own interests in mind as they stigmatize the alternative fuel.

"For farmers and for jobs, everything about ethanol is good, good, good," Grassley said. "And now it's a little irritating for me to find some agricultural groups, some livestock groups, that are complaining about it...But most of those agricultural interests are not family farm interests."

The U.S. Department of Agriculture's forecast attributed the decrease in the nation's corn supply to higher-than-expected ethanol use, saying that roughly 40 percent of corn growers in the United States use it for ethanol production. According to the Iowa Renewable Fuels Association, 61 percent of Iowa's corn crop was used to produce ethanol.

However, Grassley spun the numbers differently, saying that globally, ethanol production consumes 3 percent of the world's grain supply, and that corn prices are influenced by production in other countries that have been impacted by natural disasters. However, he acknowledged that U.S. farmers should be given a safety net to continue to grow food.

"You've got to have an ample supply of food for national security," Grassley said.