Thursday, July 30, 2020

Senate Republicans' relief bill has no special help for ethanol, unlike House bill; could have political repercussions

The petroleum and ethanol industries, long at odds with each other, are both hurting from decreased energy demand during the pandemic, but ethanol producers—and some rural voters in ethanol states—may be feeling left out in the cold by the Trump administration and Senate Republicans.

The Environmental Protection Agency "has surpassed the deadline by one month to release proposed 2021 renewable volume obligations in the Renewable Fuel Standard, an important market driver for biofuels," Todd Neeley reports for DTN/The Progressive Farmer. "And while congressional leaders continue to hammer out details on a new round of covid-19 stimulus that may include relief for ethanol producers this time, President Donald Trump was in west Texas on Wednesday touting the oil industry on a fundraising stop."

Though Senate Republicans' $1 trillion pandemic relief bill has $20.5 billion in broad funding to the Department of Agriculture, none is specifically earmarked for the ethanol industry. In contrast, the House relief bill authorizes $33 billion in agricultural spending, and "would establish the Renewable Fuel Reimbursement Program," Neeley reports. "It would provide a 45-cent per-gallon payment for feedstock purchases made by biofuels producers from Jan. 1, 2020, through May 1, 2020."

Former Iowa lieutenant governor Patty Judge, a Democrat, wrote for The Gazette in Cedar Rapids that the biofuel industry's swoon and Trump's trade war are why Trump is winning rural voters by only 9 points, when Trump carried that voting bloc by nearly 30 points in 2016. In Iowa, a Des Moines Register poll taken June 7-10 showed Trump leading Joe Biden by 1 point.

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