DES MOINES — Iowa Gov. Terry Branstad said it will be "tragic" if Ted Cruz wins the state's first-in-the-nation presidential caucuses because the U.S. senator from Texas has opposed the federal ethanol mandate that benefits Iowa's agricultural economy.

Branstad has pledged to remain neutral in the Republican presidential primary race, but on Tuesday said he believes it would be a mistake for Iowans to support Cruz because of his position on the ethanol mandate.

Cruz has said he opposes all government subsidies and mandates, including the Renewable Fuel Standard, which requires the nation's fuel supply include a percentage of corn-based ethanol.

Cruz is engaged in a close race for the lead in Iowa with Donald Trump, according to recent polls on the race here.

"I've been a strong supporter of renewable energy from the beginning, and I'm really disappointed that (Cruz) recommended terminating the Renewable Fuel Standard," Branstad said. "I think that would be really detrimental to the Iowa economy, costing us a lot of jobs and really hurting Iowa farmers, as well as all the people we have in the renewable fuel industry."

Ethanol supporters have been dogging Cruz through the state recently, including an advocacy group that is led by the governor's son, Eric.

In 2013, Cruz co-sponsored a bill that would immediately terminate the Renewable Fuel Standard. But a year later, he introduced his own bill that would phase it out over five years. Currently, the law sets targets for use of renewable fuels through 2022.

Campaigning in New Hampshire, Cruz responded to reporters asking about Branstad's statement, saying it's a sign the establishment is "in full panic mode."

"We said from the beginning that the Washington cartel was going to panic more and more. As conservatives unite behind our campaign, you're going to see the Washington cartel firing every shot they can, every cannon they can. Because the Washington cartel lives on cronyism. It lives on making deals. It lives on picking winners and losers and supporting corporate welfare," Cruz said.

Rep. Steve King, an Iowa Republican, labeled Branstad's comments an endorsement, saying the governor is, by default, supporting Trump. King has endorsed Cruz.

Branstad said his comments are not an endorsement of Trump.

"I'm not endorsing anybody. But I am the governor of Iowa, and I think I need to stand up for the interests of my state," Branstad said. "I know (Cruz) is ahead in the polls, but I think it would be tragic if somebody that wants to dismantle the renewable energy standard were to win the Iowa caucuses, because I think that would be looked at that Iowans don't care about our Iowa economy and the jobs that are related to them."

Generally, Branstad has remained neutral, though he did endorse Bob Dole in 1996. But Dave Nagle, the former chairman of the Iowa Democratic Party, said Tuesday he believes Branstad's remarks will hurt the caucuses.

Nagle says that there have been elected officials who have endorsed candidates. Former Sen. Tom Harkin endorsed Howard Dean in 2004. "But we don't blackball people," Nagle said.

Matt Strawn, a former Republican Party of Iowa, shrugged off the notion the caucuses could be damaged by the governor's declaration.

"I don't think it has any bearing on that. The governor like any elected official has every right to make his positions known on issues that are important to him," he said.

Branstad first made his comments about Cruz on when responding to a reporter's question at the Renewable Fuels Summit in nearby Altoona.