Biofuel Groups Ask Congress for Relief

OMAHA (DTN) — With the United States biofuels industry on the ropes, agriculture and ethanol industry groups are asking Congressional leaders to include biofuels in any future COVID-19 relief package.

Since the economic shutdown, about 130 ethanol plants have either fully or partially idled operations in response to falling demand for gasoline.

The Renewable Fuels Association, Growth Energy, National Biodiesel Board, American Farm Bureau Federation, National Corn Growers Association, American Soybean Association, National Farmers Union, National Oilseed Processors Association, National Renderers Association, National Sorghum Producers and Fuels America, sent a letter to Speaker of the House Nancy Pelosi and Senate Majority Leader Mitch McConnell on Monday to detail industry concerns.

“The situation we face is dire,” the groups said in the letter. “More than 130 biofuel plants have already partially or fully shut down as motor fuel demand plunged to 50-year lows. America’s biofuel plants purchase annually more than one-third of U.S. corn and U.S. soybean oil, and the loss of those markets has depressed farm income and will continue to push corn and soybean prices down dramatically.”

The recently passed CARES Act provided some loans to producers but not specific relief for biofuel companies. In addition, USDA’s approval of using Commodity Credit Corporation funds to help agriculture provided nothing to biofuels companies.

“The damage has rippled across the entire agricultural-supply chain,” the letter said.

“Ethanol plants are the top supplier of carbon dioxide to the food industry, and shutdowns have triggered commercial CO2 supply shortages, inhibiting the ability of our food and beverage sector to manufacture, preserve and supply food. Biodiesel plants provide critical demand for soybean oil, distillers corn oil, animal fats from livestock production, and recycled oils from restaurants. Reduced demand for these oil byproducts will result in higher prices for livestock feed and ultimately higher prices for consumers.”

In addition, the groups said dried distiller grains shortages already are affecting livestock rations and meat prices.

The groups said biofuel producers are doing what they can to support the public health response to COVID-19 by repurposing ethanol and glycerin supplies to produce hand sanitizer.

“However, sanitizer markets are not nearly substantial enough to sustain our workforce and bridge the industry through the crisis,” the letter said.

“While it is important that biofuel producers are included in any infrastructure or tax legislation designed to hasten America’s long-term economic recovery from COVID-19, relief is needed now to ensure these producers are positioned to bring renewable fuel production back online when conditions improve.

“It is vital that the next COVID-19 relief package include immediate, temporary, and direct assistance to help the U.S. biofuel industry retain its skilled workforce and mitigate the impact of plant closures on the food and feed supply chain and rural communities.”

The groups said USDA has the capability of overseeing direct assistance to the biofuel industry.

“COVID-19 represents an unprecedented threat to our industry and economy,” they said in the letter.

Read the letter here: https://fuelsamerica.org/….

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @toddneeleyDTN

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