Trump, Eyeing Farm Country, Starts Working on Ethanol Industry's Year-Old Wishlist

September 24, 2020

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by Stephanie Kelly and Jarrett Renshaw (Reuters) President Donald Trump, looking to shore up support in the U.S. Farm Belt during a tight race for re-election, is taking steps to help producers of corn-based ethanol using a list of policy goals that a group of Midwest senators discussed with him a year ago, according to two sources familiar with the matter.

On Sept. 12, 2019, Trump met with the senators, who were frustrated by the administration’s management of U.S. biofuels policy. They argued that Trump’s Environmental Protection Agency had been helping the oil industry at the expense of farmers dependent on ethanol sales, and presented him with a list of ways he could fix the problem, according to five sources familiar with the matter.

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A year later, Trump and his administration have begun chipping away at the industry’s wishlist, using the meeting as a blueprint to court his crucial Farm Belt constituency in what is expected to be a tight contest with Democratic rival Joe Biden, according to the sources.

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They included ratcheting down the EPA’s biofuel waiver program exempting refineries from adding ethanol to their gasoline; setting higher biofuel blending volume requirements for 2020; expanding the market for higher ethanol blends of gasoline called E15; exploring a national biofuels infrastructure program; and addressing ethanol and biodiesel trade issues, particularly with Brazil, according to the memo - the details of which have not previously been published.

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With the election looming, Trump had been under increasing pressure from within his campaign to please agriculture interests, and Midwest lawmakers and agricultural trade associations had been reminding Trump of his slow action on the 2019 wishlist up to that point.

“(In August) we turned up the message that it’s been a year, nothing has happened, and people are getting mad about it,” said one of the sources.

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Biden’s campaign and Senate Democrats had noticed farmers’ frustration with Trump and had attacked him for not holding to his commitments.

Even so, several items on the ethanol industry wishlist remain, along with new uncertainties creating angst in the Farm Belt. Biofuel interests want assurances, for example, that 2020 blending requirements will be enforced despite the fact the coronavirus pandemic has slashed fuel demand.

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They also want the Trump administration to announce its proposed biofuel blending volume mandates for 2021, and make final decisions on all outstanding small refinery exemption applications under consideration by the EPA.

On Thursday, a group of Iowa farmers sent a letter to Grassley and Ernst demanding they release details from the 2019 meeting. The group’s aim is to spotlight how Trump has fallen short on agricultural issues, its website says. READ MORE

Ethanol Coalition Urges EPA to Fully Restore RFS (Energy.AgWired.com; includes AUDIO)

Groups call on Trump administration to live up to RFS commitments (Ethanol Producer Magazine)

Agriculture And Biofuel Groups Call On The EPA To Restore The RFS (WNAX)

Ethanol, Ag Urge Trump Biofuels Action: Ag, Ethanol Groups: Trump Rejection of Gap-Year RFS Waivers Just Beginning (DTN Progressive Farmer)

Refineries prospects on ethanol waivers dwindle (Houston Chronicle)

Keep a close eye on EPA, RFS: To restore support for the Renewable Fuel Standard, EPA must keep its promise to deny waiver requests. (Wallace's Farmer)

Trump Is Losing Farmer Support in the Climate Crisis. Will They Swing the Election? (EcoWatch)

ETHANOL BACKERS PROD ADMINISTRATION TO ‘FINISH THE JOB’ (Successful Farming)

ETHANOL AND FARM GROUPS CALL ON EPA TO REJECT REMAINING WAIVERS (NewsDakota)

ETHANOL LEADERS CONCERNED ABOUT ‘MISHANDLING’ OF RFS (Brownfield Ag News; includes AUDIO)

Trump risks support in oil-producing swing states as he boosts ethanol to court Iowa farm vote (Washington Examiner)

The power of incumbency: How Trump is using the Oval Office to win reelection (The Hill)

Letters: Biden will seek out long-term, viable solutions (Des Moines Register)

Iowa ethanol leader: Trump needs to do more, Biden needs to visit (Fence Post)

MORE BIOFUEL BLENDING WAIVER DECISIONS NOT LIKELY AHEAD OF ELECTION, IOWA SENATOR SAYS (Successful Farming)

Iowa again a battleground, sign of Trump’s Midwest obstacles (Associated Press)

Uphold the Renewable Fuel Standard (Oseola Sun)

Pence: Road to White House runs through Iowa (The Courier)

Op-Ed: Why Farmers Should Vote to Re-Elect Trump (Ag Web)

Op-Ed: Why Farmers Should Elect Biden--Biden’s Plan will Build a Farm Economy Where Today’s and Tomorrow’s Farmers and Ranchers Can Succeed (Ag Web)

Ethanol Remains Top Priority with New NCGA President (Energy.AgWired.com)

Trump is responsible for U.S. ethanol crisis (Marshall Independent)

Excerpt from EcoWatch: On September 22, the Biden campaign launched a new radio ad blitz in eight battleground states, in which Biden appeals to older voters whose families have lived in rural areas for generations. "No longer are we going to be faced with children or grandchildren believing that the only way they can make it is to leave home and go somewhere else to get that good job," Biden's voice assures. "There's no reason why it can't happen here."

In a contrasting approach, at a rally in North Carolina, just a few hours ahead of the opening of the Republican National Convention in August, Trump claimed that, under his administration, "The American farmer has done very well. I never hear any complaints from the American farmer." Remarks later that week during the convention followed suit. "The economy is coming up very rapidly, our farmers are doing well because I got China to give them $28 billion because they were targeted by China," Trump said on the first night of the convention.

But that assessment doesn't square with the hardship many U.S. farmers are facing — particularly small farmers. U.S. farm bankruptcies increased 20 percent in 2019, reaching an eight-year high, on account of factors like the trade war, increasing costs of production and crop loss related to the climate crisis.

Since April 2020, farmer support for the incumbent president has fallen from 89 percent to 71 percent, according to an August 2020 survey by DTN/The Progressive Farmer. READ MORE

Excerpt from Brownfield Ag News: Geoff Cooper, president of the Renewable Fuels Association, says while the denial of the “gap-year” waivers was a step in the right direction, it shouldn’t have been on the table to begin with.

“It’s simply doing something that should’ve been done or [rather] undoing something that never should’ve happened in the first place,” Cooper said. “This notion that there’s got to be ‘if you’re going to do something for the ethanol industry [then] you got to do something for refiners’ is just a ridiculous notion.” READ MORE includes AUDIO

Excerpt from Washington Examiner: Something politicians “should keep in mind as they consider where to come down on the RFS and the implications of it is not just to focus solely on Iowa,” said Frank Macchiarola, senior vice president of policy, economics, and regulatory affairs for the American Petroleum Institute.

“There are oil and gas jobs in Pennsylvania, Michigan, and Ohio that rely on a policy that will not restrict oil and gas development or refining, and those are good-paying jobs,” he added.

Nonetheless, recent polling shows Trump and Democratic nominee Joe Biden dead even in Iowa, and Trump seems to be dusting off his 2016 playbook. Trump made grand promises to boost corn ethanol in the last presidential race, and he won Iowa with 51% of the vote, sweeping most of its rural counties.

In the last few weeks, Trump has made announcements to boost biofuels, including the sale of higher-blend ethanol known as E15. His administration rejected dozens of waivers from small oil refiners seeking exemptions from the Renewable Fuel Standard, known colloquially as the RFS.

Oil-state Republican lawmakers, such as Wyoming Sens. John Barrasso and Mike Enzi and Pennsylvania Sen. Pat Toomey, slammed the Environmental Protection Agency for rejecting the waivers, which they saw as a lifeline for small refineries in their states.

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The big question, however, is whether rancor over the biofuels mandate would actually push oil industry workers not to vote for Trump. They have many more reasons not to want to vote for Biden, whose aggressive climate plan would bar new oil and gas leasing on federal lands, target a carbon-free power sector by 2035, and quickly ramp up electric cars.

Trump seems to be making that calculation, and for now, his campaign seems more worried about losing votes in Iowa.

The Biden campaign has been increasingly trying to capitalize on the seeds of distrust in Trump among farmers planted by years of back-and-forth over the RFS requirements.

“Lip service 50 days before an election won’t make up for nearly four years of retroactive damage that’s decimated our trade economy and forced ethanol plants to shutter,” Biden said in a campaign statement Sept. 15. A Biden administration would keep its promises to farmers “by ushering in a new era of biofuels,” the former vice president added.

The Biden campaign has a team of well-known surrogates, including former Iowa Gov. and Obama-era Agriculture Secretary Tom Vilsack and former Iowa Lt. Gov. Patty Judge, on the ground in Iowa hammering that argument home, accusing Trump of empty promises on ethanol.

There’s another reason why Trump and Republicans are focused on Iowa: Sen. Joni Ernst is up for reelection in one of the toughest races in the country. Toomey, meanwhile, doesn’t face reelection until 2022.

Each time Trump boosts ethanol, it gives Ernst, who has never been afraid to battle her own party on the RFS, another win to tout to Iowans. For example, just a few weeks ago, Ernst confronted Trump publicly in Iowa over the small refinery exemptions, securing a promise from Trump to intervene personally, ultimately leading to the EPA’s rejection of more than 50 waivers.

Those on the ground in Iowa suggest there are rural votes in the state that could be up for grabs.

“There were clearly some farmers and rural folks that kind of wanted to vote for Trump — they typically would not even hesitate voting for the Republican — who were, and I cannot emphasize, bold, italics, underline, emphasize this word enough, deeply frustrated with Trump and his handling of renewable fuels,” said Monte Shaw, executive director of the Iowa Renewable Fuels Association, describing conversations he’s had with farmers and others in rural Iowa in recent weeks.

For some of those rural voters, Trump’s recent boost for ethanol put him back in their good graces, Shaw said. Others, though, still wonder if there’s “another shoe to drop” in the form of backing for the oil industry, he added.

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Ethanol isn’t even a top voting issue for Iowans, Macchiarola said. He pointed to recent Des Moines Register polling, showing 0% of voters said ethanol was their top voting issue.

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Climate change, though, could also sway rural votes in the other direction. Wayne Moyer, a professor at Grinnell College in Iowa, said he attended Democratic caucus events earlier in the year where farmers were independently raising climate change. He pointed to intense flooding in the Midwest last year. READ MORE

Excerpt from Ag Web: Important both for farmers and for our energy independence is Joe’s commitment to biofuels. He will uphold and enforce the Renewable Fuels Standard, and reverse the current administration’s tide of waiver handouts for Big Oil. He will invest $400 billion in clean energy research, innovation, and deployment, and he will use every tool at his disposal, including the federal fleet and the federal government’s purchasing power, to promote and advance ethanol, biodiesel, and other biofuels. READ MORE