CC22 Nathan Eckel Secretary Ohio Soybean Council and Patrick Knouff President Ohio Soybean Association photo

Policy highlights from Commodity Classic

By Matt Reese and Dusty Sonnenberg

Corn, soybean, wheat, and sorghum farmers from around the nation were excited to gather again for the Commodity Classic, held in New Orleans this year. Nearly 8,000 attendees — farmers as well as exhibitors, industry stakeholders and members of the media — met in March for the return to an in-person Commodity Classic for 2022.

“The biggest part of what we are doing down there is trying to set policy for the next year that we want the American Soybean Association to lobby for in D.C.,” said Pat Knouff, the Ohio Soybean Association president from Minster. “We are getting closer to a new farm bill so we talked quite a bit about Title I farm safety net programs. We’d like to see better staffing at these county offices. There are a lot of open positions right now. We are trying to push forward with that to help with signups with farm programs in the future. I think the offices are getting things accomplished, but I know even my local office is down some employees and they are in the situation where a lot of employees are set to retire in the next few years, which would exasperate the situation. 

“We also looked at transportation and getting products in and out of the country in a more timely manner. That was definitely a big discussion around trying to ease the supply chain delays and obstructions. We discussed free trade agreements too. We are always looking for opportunities for our soybeans to leave this country. We are trying to keep USDA dollar amounts in their research built up on the soybean side as well. We feel like USDA needs to be investing in that research to help the soybean industry.”

Concerns about the 2022 changes from the Environmental Protection Agency regarding the ban of the use of Enlist products in counties around the country were also on the agenda at Commodity Classic.

“The Endangered Species Act is a big problem, especially with the restrictions on the Enlist products in so many counties. We are pushing for some changes there to allow farmers to use those products, or at least if you are going to change the rules, make sure the rules gets changed in a timely enough manner that we have the opportunity to change what we are going to use chemically,” Knouff said. “This looks like it could be more of an issue as we go along. There are people complaining about EPA not adhering to the Endangered Species Act. I think this is something we are going to have to worry about if we get some new chemistries. This is something we are going to have to keep watching.”

Since the Commodity Classic, EPA announced changes in late March regarding the Enlist One and Enlist Duo labels. These products are now approved for 2022 use in all Ohio counties and many of the previously banned counties around the country. 

With a focus on expanding green energy sources at the federal level, biofuels and their sustainability dominated much of the discussion at Commodity Classic this year.

“We need to figure out how sustainable soybeans are so we can be more competitive in the biofuels realm,” Knouff said. “Our government is looking to be more green and carbon neutral. What better way than to use more bioproducts to get to that point?”

On the corn side of Commodity Classic, ethanol was a major focus of attention, especially with concerns over petroleum products due to the Russian invasion of Ukraine and staggering fuel costs.

“The answer to this is right under our noses. This is not about politics. It is just about taking a look at homegrown resources. Ethanol has the ability today to take care of all of this pressure from the Ukrainian war,” said Tadd Nicholson, executive director of Ohio Corn & Wheat. “If we want to eliminate what we imported from Russia right now, all we have to do is convert a third of our E10 fuel today to E15, just add 5% ethanol, and we completely eliminate what we had been importing from Russia. The answer to our future is sitting here right in front of your nose, and it’s the American farmer.” 

Nicholson pointed out that the infrastructure is already in place to increase ethanol use in the United States and address some significant challenges.

“We have infrastructure being manufactured today. Wayne Fueling Systems is a company that makes a lot of the fuel pumps that are out there and almost everything they are selling is compatible up to E25 or higher blends,” Nicholson said. “This is not an infrastructure issue. In Ohio, the Sheetz stations if you look for the blue handle, it is Unleaded 88. That is 15% ethanol. It is available to us right now and it is cheaper than petroleum.” 

Jan tenBensel is a Nebraska farmer and president of the Nebraska Ethanol Board. He has been taking a close look at global oil/ethanol dynamics. 

“We import about 440,000 barrels of petroleum products from Russia every day. That really shocks some people. It is not all crude oil. It is a number of different products that are used in refineries and petrochemical manufacturing. About half of that is turned into gasoline, which is about 220,000 gallons a day,” tenBensel said. “The question is, how are we going to replace that? We can replace that with the unused ethanol capacity we have right now in the United States, which is roughly 2.5 billion gallons of production. Plants are not always running at full capacity at all times based on current market conditions and a number of factors. They slow their corn grind to meet their market conditions. 

“By moving to E15 in a third of our current E10 gallons, which is essentially 30% of the fuel use in the U.S., we would use the unused ethanol capacity. This could be done almost overnight. The corn grind could be dialed up pretty quickly and that would really take some pressure off the fuel markets. Right now ethanol is trading at about a dollar discount toReformulated Blendstock for Oxygenate Blending for gasoline. In addition to that there is a $1 RIN to ethanol. We also have over a billion gallons of excess ethanol inventories right now. This could almost be an immediate solution if the Administration and EPA were to choose to go the direction of granting emergency waivers for E15 to put it into the marketplace and fuel supply.”

Following Commodity Classic, in a letter to the White House, American Farm Bureau Federation, Growth Energy, National Corn Growers Association, National Farmers Union, National Sorghum Producers, and the Renewable Fuels Association explained that an immediate move to restore year-round sales of E15 would ease the impact of oil market disruptions and surging gas prices caused by Russia’s invasion of Ukraine.

“As American families continue to confront skyrocketing gas prices, we write today to urge the Administration to take a simple action that can provide immediate relief at the pump while simultaneously reducing carbon emissions from the transportation sector,” wrote the organizations. “Specifically, we request that the Administration use its authority to authorize the year-round sale of gasoline blended with up to 15% ethanol in response to surging oil prices and expected fuel supply disruptions. 

“As Russia’s harmful actions in Ukraine continue and further sanctions are potentially imposed against Russia, oil prices will likely continue to rise, creating still higher consumer costs and threatening U.S. energy and economic security. Expanding the volume of American-made ethanol in the U.S. fuel supply can help alleviate these issues, as ethanol is currently priced 70 to 80 cents per gallon lower than gasoline. And, by displacing imported petroleum, increased ethanol use will enhance U.S. energy security and independence, while reducing emissions and supporting America’s farmers and rural economies.”

It seems like a win-win, at least to those gathered at Commodity Classic in March. In total, the 2022 Commodity Classic featured more than 50 educational sessions, a sold-out trade show with nearly 400 exhibitors, a keynote address by U.S. Secretary of Agriculture Tom Vilsack, and policy meetings of the sponsoring commodity associations. Attendees enjoyed a wide variety of presentations from top farmers and well-known industry leaders along with tours of popular New Orleans attractions. 

The 2023 Commodity Classic will be held March 9-11, 2023, in Orlando. For information, visit CommodityClassic.com.

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