Agreement Eludes White House on Biofuel Path to Calm Corn Belt

Source: By Mario Parker and Jennifer A Dlouhy, Bloomberg • Posted: Sunday, September 8, 2019

President Donald Trump and top administration officials were unable Friday to finalize a plan for aiding biofuel — and quelling corn-belt criticism — after agricultural groups and farm-state lawmakers said a compromise under consideration would only stoke more anger.

A White House meeting on the issue Friday afternoon ended without agreement on a final package of changes to bolster U.S. biofuel-blending mandates and take other steps to propel corn-based ethanol, despite weeks of negotiations and Trump’s Sept. 2 tweet promising “big” changes within two weeks. The administration will continue to deliberate, according to people familiar with the talks who asked not to be named to discuss a private meeting.

Trump has been responding to intense criticism from farmers and politicians in the American Midwest who say his administration has too willingly issued waivers exempting small refineries from a 2005 law requiring them to use biofuel, including corn-based ethanol and soybean-based diesel.

The backlash has been especially strong in Iowa, an early voting state that helped elect Trump to the White House in 2016 and is critically important to his re-election in 2020.

However, the administration has struggled to develop an initiative that would satisfy biofuel producers, much less another key constituency: oil refiners.

Earlier: Trump Orders Biofuel Boost in Bid to Temper Farm State Anger

Biofuel interests and their political allies warned the White House before Friday’s meeting they were disappointed with the administration’s drafted plan, which would not rescind recently issued refinery waivers and would only begin taking steps to account for those exemptions in 2021 blending quotas. They had asked the administration to formally offset refinery waivers sooner by factoring expected exemptions into 2020 blending requirements.

Hours before Friday’s meeting, ethanol and biodiesel supporters were making last-minute appeals to the White House, arguing the effort fell far short of what was needed. Senator Chuck Grassley, an Iowa Republican, said on Twitter that a rumored plan would be a “disaster for ethanol and corn growers.”

Senator Joni Ernst, also an Iowa Republican, drew a similar line in the sand, insisting on Twitter that “the only good deal for Iowa farmers is one that upholds the intent of the RFS,” or the Renewable Fuel Standard, the 2005 law that mandates biofuel.