Iowa Producers Say Ethanol Limits Would Be ‘War’ on Rural US

Source: By David Pitt, Associated Press • Posted: Monday, April 9, 2018

DES MOINES, Iowa — Iowa ethanol and biodiesel producers warned President Donald Trump on Friday that imposing restrictions on biofuels production “would be viewed as a declaration of war on rural America.”

The Iowa Renewable Fuels Association, a group representing the state’s 43 ethanol and 12 biodiesel refineries, wrote a letter to Sens. Charles Grassley and Joni Ernst on Friday. It called on them to tell Trump that limiting biofuel production would be a “complete abdication of his repeated promises” to protect the renewable fuel standard, a federal law that mandates a minimum volume of biofuels to be mixed in the nation’s gasoline and diesel fuel supply.

The group said it has heard that EPA Administrator Scott Pruitt will push Trump on Monday for a proposal advocated by Sen. Ted Cruz of Texas that would significantly reduce demand for biofuels.

The EPA and the White House did not immediately respond to messages seeking confirmation of a meeting.

Cruz has tried to get Trump to waive some of the requirements in the federal Renewable Fuel Standard law that would ease gasoline and diesel refiners’ volume mandates. That would reduce demand for the biofuels and violate the RFS, the biofuels producers said.

The biofuels producers allege that Pruitt already has taken action to lift some of the mandated blending requirements through secretive waivers to some petroleum refiners exempting them from compliance and destroying more than a billion gallons of biofuels demand.

“Since taking the helm at the EPA, Pruitt has repeatedly and relentlessly sought ways to subvert the President’s RFS promises and to undermine, if not destroy, the effectiveness of the program. His anti-RFS actions must be put to an end because today Scott Pruitt is essentially making a liar out of President Trump,” the group said.

Trump gained early support in Iowa during his presidential campaign in part of emphasizing his support for the decades-old RFS program, which is managed by the EPA.

Corn, soybeans and animal fat are used in the production of biofuels and farmers rely heavily on markets for their products created by the fuel additives.

Farmers already are stinging from Trump’s tariff fight with China which has affected pork exports and prices and the export of ethanol to China. The next round of tariffs could impact exports of soybeans for which prices already have fallen in anticipation of Chinese tariffs.

Pruitt was closely aligned with the oil and gas industry as an elected Republican official in his home state of Oklahoma. He proposed modest cuts last summer to production quotas for ethanol and other biofuels, despite promises from Trump to leave the RFS alone.

“EPA is chipping away at the Renewable Fuel Standard by issuing secret ‘hardship’ waivers to oil refining corporations making billions of dollars in profits,” Grassley said in a statement, adding further erosion of the RFS would “deal a massive blow to rural America.”

Ernst said in a statement that she and Grassley have had countless meetings with Trump and the administration on ethanol and she is “fully committed to protecting the RFS and will not support anything that will harm the 88,000 farms in Iowa or the 50,000 jobs tied to the renewable fuels industry.”

The American Petroleum Institute, a trade group for the oil and natural gas industry, said it continues to work with leaders in Congress to come up with a comprehensive approach “to fixing the outdated and broken ethanol mandate.”

“We appreciate the president elevating this important consumer issue and support efforts to seek a legislative overhaul of the RFS,” the group said in a statement.