Trump Requests Another Meeting to Hear Ethanol Industry’s Side on RFS Debate

Source: By Todd Neeley, DTN/Progressive farmer • Posted: Wednesday, February 28, 2018

Grassley said the ethanol industry would like to see year-round E15 sales, while Cruz continues to suggest reform to prevent speculation on RIN markets.

“But all of these are rendered useless if a cap or waiver is proposed,” Grassley told reporters.

When asked if Cruz’s release of the Northey nomination is an indication the senator is backing off his RFS pursuits, Grassley said, “I wouldn’t expect Sen. Cruz to back off of any position he has on any subject.”

Ernst agreed. “We’re going to be fighting this out,” she said.

Not long after the White House meeting adjourned, Trump tweeted his support for Cruz on his March 6 re-election bid. “I want to encourage all of my many Texas friends to vote in the primary for Governor Greg Abbott, Senator Ted Cruz, Lt. Gov. Dan Patrick, and Attorney General Ken Paxton. They are helping me to Make America Great Again! Vote early or on March 6th,” Trump tweeted.


Ethanol industry leaders already were slated for a panel discussion this week at Commodity Classic and the National Corn Growers Association’s Corn Congress in Anaheim, California. There was a sigh of relief from corn farmers and ethanol leaders that the White House reportedly held firm on the RINs issue for now.

Kevin Skunes, president of NCGA and a North Dakota farmer, noted that corn farmers are losing an average of $10 an acre on their crop. Farmers can’t afford policy shifts that hurt corn demand, Skunes told reporters.

“Our farmers cannot afford any deal that undermines demand for ethanol,” Skunes said.

Bob Dinneen, president and CEO of the Renewable Fuels Association, said there is no deal on RFS changes despite an oil industry narrative to the contrary.

Ethanol production is expected to top 16 billion gallons in 2018, he said, satisfying both the RFS and the export markets.

“Now is not the time to be letting off the gas,” Dinneen said. “We’ve got some real challenges in front of us. The foundation of that demand is the RFS, which is under attack because you’ve been successful.”

With the release of the hold on Bill Northey’s nomination, Dinneen said, all Cruz got for his efforts was a meeting at the White House.

“I don’t believe it was a quid pro quo other than Ted Cruz giving into a whole lot of pressure,” Dinneen said.

Chris Novak, CEO of the National Corn Growers Association, also panned the idea of attaching RINs to exports. Trade partners would construe that as an export subsidy.

“Essentially, when you do that you are subsidizing your exports, which is vulnerable to WTO (World Trade Organization) challenges,” Novak said.

Brian Jennings, CEO of the American Coalition for Ethanol, said the refining industry is divided regarding possible changes to the RFS, largely because most of the industry has been able to work with the RINs market as well as ethanol supplies. He said allowing year-round E15 sales would cure many ills in the market.

“The quickest way to increase the supply of RINs is RVP relief,” Jennings said.

Jennings also noted a 60-cent RIN price provides demand for ethanol and pays for infrastructure to get higher blend levels to consumers.

There needs to be a long-term plan to ensure demand for higher-octane, low-carbon biofuels, he said. That’s the only way to increase demand through mid-level biofuel blends. Right now, however, the Trump administration doesn’t seem ready to advance those rules.

“The leadership at EPA and the leadership in the administration need to buy into this as a future priority and they are not there yet,” Jennings said.