Farmers rally for RFS
By DOUGLAS BURNS
NEVADA — Some of the nation’s top renewable-fuels and corn and soybean advocates, backed by hundreds of farmers and ag businesspeople, rallied Saturday outside of Nevada, Iowa, to protect the Renewable Fuel Standard from what crucial players in the Hawkeye State’s key commodity markets see as a mortal threat from Republican U.S. Sen. Ted Cruz of oil-rich Texas.
The pitched political fight, which is spilling from the corridors of power in Washington, D.C., to Iowa farms and small towns as tens of thousands of jobs hang in the balance, will have implications for two of the more vital figures in Iowa’s economy — the price of corn and soybeans.
The Renewable Fuel Standard, by requiring refiners to blend growing amounts of biofuels into the nation’s fuel supply, has allowed Iowa’s ethanol and biodiesel industries to mature, boosting farmers and small towns.
Now, though, Cruz, who won the 2016 GOP presidential caucuses in Iowa with the support of U.S. Rep. Steve King, R-Iowa, wants to cap waiver credits — which are traded in the fuels industry among those who hit, surpass and fall short of federally mandated renewable-fuels levels.
Cruz wants to top out the renewable fuels credits at 10 cents. They had been trading at 90 cents each, or per gallon, as recently as November.
Renewable Identification Numbers (RINs), attached to each gallon of ethanol, are used to manage the trading.
The cap would allow for paper trades, meaning less ethanol manufacturing, in addition to the effects on the markets, according to biofuels leaders.
Bottom line: The Cruz proposal would cut corn prices by as much as 25 cents per bushel and reduce soybean prices by 16 cents per bushel, according to the Iowa Renewable Fuels Association.
The potential for that catastrophic hit to already-beleaguered corn and soybean markets drew 200 people to a quickly-called rally at the cattle and diversified crop farm of Bill Couser north of Nevada Saturday.
“We need to remind Washington about the homegrown fuel that we make here in Iowa,” said William Howell, of Coon Rapids, general manager of the POET biorefinery and vice president of the Iowa Renewable Fuels Association. “Over the last four years, farmers have seen the sharpest decline in income since the Great Depression. Land values have dropped at a rate we haven’t seen since the 1980s. Farm debt is rising rapidly, even as commodity prices continue to hover below break-even prices.”
Howell said Cruz’s plan to gut the Renewable Fuel Standard amounts to a naked-in-the-light-of-day “oil refinery bailout.”
“Senator Ted Cruz has carried this false narrative to Washington and straight to the White House, where it has landed on the plate of President Trump,” Howell said. “Right now, a plan is on the table that would not only break the president’s promise to support the Renewable Fuel Standard, it would crush the growth of biofuels and cut the lifeline to America’s farmers.”
Howell added, “We can’t stand by and let rural America be sacrificed to the oil industry.”
For his part, Bill Couser, who operates the Couser Cattle Company, said the rally was about making sure promises made to Iowa farmers in the heat of campaign are kept.
Mark Recker, president of the Iowa Corn Growers Association and a northeast Iowa farmer, said Cruz’s plan represents “maybe the largest threat we’ve seen” to the Renewable Fuel Standard.
Grant Menke, policy director of the Iowa Renewable Fuels Association, said Cruz is on a “crusade” to destroy the Renewable Fuel Standard and operates in a “disingenuous” manner where Iowa farmers are concerned.
Menke’s message to President Donald Trump: “Keep your promise to the rural Americans in Iowa and around the country who put you in office.”
Charlie Good, a C-Store owner from Nevada, and Rick Schwarck, CEO of Absolute Energy LLC in St. Ansgar, recently joined other biofuels advocates in the West Wing of the White House for a meeting with President Trump and oil industry leaders.
Good said he believes Trump understands the damage the Cruz plan would do to the Iowa economy.
Schwarck said U.S. Sens. Joni Ernst and Charles Grassley, both Iowa Republicans, have been crucial advocates for ethanol and biodiesel.
“The word is intense,” he said.
As the meeting proceeded, the ethanol advocates said they were concerned Cruz may be gaining sway with Trump to favor the oil industry.
Iowa Biodiesel Board Executive Director Grant Kimberley said it cannot be stated strongly enough that Cruz’s plan for RFS waiver credits would decimate current demand for biofuels.
“We hope President Trump sees through this bad deal and rejects a cap on RIN prices,” Kimberley said. “I urge him not to cave in to the interests of certain oil companies and refiners, and stay true to rural America.”
The RFS came into the nation’s fuels picture under President George W. Bush.
It has fostered a market for ethanol amounting to 15 billion gallons a year, according to Reuters.