By: US AgNet Staff
5/14/2020
After leading a call for biofuel support to be included in the next COVID-19 legislative relief package, U.S. House Representatives Angie Craig (MN-02), Cheri Bustos (IL-17), Abby Finkenauer (IA-01) and Cindy Axne (IA-03) successfully secured support for the industry as part of the Heroes Act.
The letter was also signed by Reps. Dave Loebsack of Iowa; Mark Pocan and Ron Kind, both of Wisconsin; Collin Peterson, also of Minnesota; Lauren Underwood of Ohio; and Kendra Horn, Oklahoma.
The HEROES Act includes direct assistance for the biofuels industry. It would provide biofuels producers with $0.45/gallon for all biofuels (including corn starch ethanol) produced between Jan 1, 2020 and May 1, 2020, and if production was halted for any time in that window, half of that rate (22.5 c/gallon) for the amount produced during that same time period in 2019. This equates to $2.25B in direct assistance for biofuels producers.
The group led a letter to House leadership, warning that a struggling biofuel industry could have cascading effects on the entire agriculture sector. In the wake of the COVID-19 pandemic, demand for biofuel production has fallen to record lows, with nearly 150 biofuel plants falling idle or cutting production, leaving many producers unable to make ends meet. As biofuel demand has waned, corn and soybean production prices have fallen by 15 and 10 percent, respectively. With projections showing deep losses, 350,000 American jobs could be at risk.
“Prices are at record lows, and producers are unable to make ends meet,” the lawmakers wrote. “These dire statistics translate into devastating economic impacts throughout the economy, as rural job losses mount in our districts, agricultural commodity prices fall precipitously, hurting farmers, and shortages of biofuel co-products impact food security.
The health of the agriculture sector is directly tied to the health of the biofuel industry, the lawmakers said.