Key soybean issues discussed at roundtable09/03/2019 |
By Joseph L. Murphy, ISA communications manager
Iowa Congresswoman Cindy Axne co-hosted an agriculture roundtable Thursday at the Iowa State Capitol with U.S. Department of Agriculture Under Secretary Bill Northey. The two federal officials addressed concerns impacting Iowa agriculture.
Surrounded by representatives from Iowa ag groups, Axne said the Trump administration needs to reverse course on issuing waivers.
"We are doing everything we can at the federal level to assist with some of the hardships that our farmers are facing and we are here to listen to your concerns," Axne told about 40 people in attendance for the meeting.
Last month the EPA granted 31 new small refinery exemption (SRE) waivers from the obligations of the Renewable Fuel Standard (RFS). The move has forced some ethanol and biodiesel plants to reduce production.
Tim Bardole, president-elect of the Iowa Soybean Association (ISA), has already felt the pinch while trying to deliver corn to his local ethanol plant.
"I have corn priced for July delivery, but long lines and reduced hours have made it difficult for me to deliver to the ethanol plant," Bardole said after the meeting. "The long and short of it is that this is definitely affecting us."
Grant Kimberley, executive director of the Iowa Biodiesel Board and director of market development for ISA, wants Axne and other federal officials to know that the exemptions impact biodiesel production along with ethanol production. He told Axne that the SRE waivers and the lapse of the biodiesel tax credit continue to hamstring the industry.
"These two issues combined have been clobbering the biodiesel industry and also domestic soybean demand," Kimberley said. "This comes at a time when there is already destruction to soybean demand due to Chinese retaliatory tariffs on soybean exports."
In 2005, Congress established a $1.00-per-gallon tax credit for U.S. fuel blenders that include biodiesel and renewable diesel in their fuel mix. The tax incentive plays a crucial role in supporting the growth of the U.S. biodiesel and renewable diesel industry, helping producers create jobs, diversify fuel markets, and strengthen U.S. energy security according to the National Biodiesel Board (NBB).
"The Biodiesel Tax Credit has lapsed for more than 20 months and that's the longest in the history of the credit that it has been expired," Kimberley said. "It is severely hindering biodiesel producers by curtailing production and forcing up to six public announcements of plant closures across the country with more to be announced in the next month or two if nothing is changed."
According to the NBB, between 2013 and 2015, the EPA granted extensions to seven or eight small refineries each year. Then in early 2017, the agency rapidly increased the number of exemptions. NBB has argued in court that the EPA has a duty to ensure the RFS volumes are made whole following the exemptions.
"The EPA itself acknowledges that the small refinery exemptions have created more than 2.2 billion carryover RINs (Renewable Identification Number) that will flow into 2020, reducing the demand for biofuels below the volumes it has proposed," Tom Brooks, chair of the Iowa Biodiesel Board and general manager of Western Dubuque Biodiesel in Farley, Iowa, said in a statement. "The exemptions have already destroyed demand for more than 360 million gallons of biodiesel and renewable diesel. That happens to equal an entire year's worth of production in Iowa."
Axne promised the ag representatives in attendance that RFS and SRE waivers are a top priority.
"I'm going to get to the bottom of this," she said. "I'm sick and tired of seeing hard-working farmers in this state being used as pawns."
Axne also told the group that passage of the U.S.-Mexico-Canada (USMCA) agreement is a priority in the work she is doing in Washington, D.C.
"I'm very positive about where things are at," she said. "I'm thrilled at where we are from an agriculture perspective and a manufacturing perspective. The important thing to keep in mind is that we have to work out the regulatory oversight so that the best practices are enforced."
Axne said that Democratic party leaders have told her they believe they will get USMCA done this fall.
"It is important that we get this done as soon as possible," Northey said. "It will lead to positive trade momentum that can be paired with positive trade discussions that came out of Japan earlier this week. That creates the kind of momentum that allows for more opportunity. Agriculture needs USMCA."
Bardole attended the roundtable to let the federal officials know that the issues discussed are critical to his farming operation and the economy in Iowa.
"These issues have affected prices and the cashflow of farmers to say nothing about how it has impacted the Iowa economy," he said.
Contact Joseph L. Murphy at firstname.lastname@example.org.
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