Six farm and commodity organizations including American Farm Bureau Federation, National Farmers Union, American Soybean Association, National Sorghum Producers, National Corn Growers Association and the National Association of Wheat Growers are calling on President Trump to support the Renewable Fuels Standard.
Trump is meeting with key lawmakers and Cabinet members to discuss escalating tensions over the RFS between oil industry and ethanol industry interests on Tuesday.
The farm groups sent the President a letter today, underscoring the importance of a strong RFS for farming and rural communities.
“The President and his administration have expressed strong support for the RFS since the early days of President Trump’s campaign,” said NFU President Roger Johnson. “We want to be sure he remembers these promises he made to farmers and rural communities as he meets with senior administration officials and lawmakers. Rural communities are under a lot of economic stress, so there is much to gain from a strong RFS, and a lot to lose by weakening it.”
The farm groups’ letter drew attention to the dire state of the farm economy. The U.S. Department of Agriculture projects 2018 net farm income will decline $4.3 billion, a 6.7% reduction from 2017 levels. This represents a 50% decline in net farm income since 2013. “The heart of America is being left behind when it comes to economic growth and opportunity,” said the groups.
"The RFS helps to maintain demand for soybeans in biodiesel in a time when farm income and crop prices are down significantly," said American Soybean Association President John Heisdorffer. "It is functioning as intended and serves as a strong engine driving the rural economy. The RFS has been successful in expanding new markets for our farmers, creating new jobs in rural America, giving consumers more fuel choices, and improving our nation’s air quality."
The groups say the RFS has been "a strong engine driving the rural economy," yet economic conditions in rural America are still in decline, while most oil refiners are experiencing a boom and significant gains from recent tax reforms. And it is their opposition that is fueling the depressed growth of homegrown biofuel industry, according to the farm groups.
Recent claims from an East Coast refiner that the RFS caused it to file for bankruptcy initiated the most recent round of tensions and therefore the Tuesday meeting at the White House. The letter noted that these claims “are not reflective of the state of the refining industry, but rather the hallmark of poor business decisions and a willingness to put investor returns before refinery jobs.”
“Despite the claims of adverse impacts from Renewable Identification Number (RIN) costs, last November, the Environmental Protection Agency concluded that RIN values are not causing economic harm to refiners,” said the letter. “The failings of one company should not be used as an excuse for undermining a law that serves hundreds of ethanol and biodiesel plants, tens of thousands of renewable fuel plant workers, and millions of farmers who rely upon the strong market demand created by the RFS.”
“There are options to address refiners’ concerns that do not undercut the RFS. Any action that seeks to weaken the RFS for the benefit of a handful of refiners will, by extension, be borne on the backs of our farmers,” the groups concluded.
"President Trump has exhibited and reiterated strong support for the RFS, and we look to him to continue his support," Heisdorffer said. "We strongly urge President Trump to reject any proposals that would undermine the purpose and intent of the RFS, and instead pursue options to address refiners’ concerns that do not undercut the RFS or harm a program that provides important benefits for farmers and rural communities."
Source: NFU, AFBF