Midwest Farmers Demand Action From Pruitt

Midwest Farmers Demand Action From Pruitt

Unites States Environment Protection Agency (EPA) Administrator Scott Pruitt was not met with a warm welcome as he made his way through farm country, this week. Farmers across the Midwest made their voices heard and shared their frustrations with Pruitt for not moving forward with President Trump's request to make higher blends of ethanol, like E15, available year-round and for granting RFS waivers to refineries at the expense of farmers. E15 is an advanced, homegrown biofuel with a naturally high octane that burns cleaner and cooler than regular gasoline. Corn is the primary ingredient in ethanol, so increasing the standard use from E10 to E15 is popular among corn farmers. But big oil companies oppose the potential increase because an increase in ethanol decreases the demand for oil. 

The Renewable Fuel Standard (RFS) is a federal program that requires transportation fuel sold in the United States to contain a minimum volume of renewable fuels.

“Corn growers came out in force this week to reinforce the importance of allowing higher blends of ethanol in the marketplace and shine a spotlight on EPA’s actions that are destroying demand for corn,” said Kevin Skunes, president of the National Corn Growers Association. “We have to continue to beat the drum and be vocal about these issues. Farmers have been very clear – it’s time for Administrator Pruitt to uphold the president’s statements on granting E15 year-round and time to stop granting waivers to refiners.”

Pruitt started his visit in Kansas. Members of the Kansas Corn Growers Association (KCGA) participated in a meeting with Administrator Pruitt after he toured the East Kansas Agri-Energy LLC (EKAE) ethanol plant in Garnett, Kansas. EKAE produces more than 40 million gallons of renewable, clean-burning ethanol, 200,000 tons of the livestock feed distillers grains, and 5 million pounds of corn oil each year from more than 16 million bushels of locally-sourced corn, according to its website. KCGA President Ken McCauley said farm and ethanol groups at the meeting wanted to set the tone and help Administrator Pruitt understand the frustration being felt in rural America. Pruitt told the crowd that, as regulators, the EPA is not supposed to pick winners and losers.

When you look at what EPA is doing, they are most definitely picking winners and losers and right now, ethanol is the loser,” said KCGA President Ken McCauley. “Our concern was that Administrator Pruitt thought he could come to Kansas, take a few photos with smiling farmers and tell the president that corn farmers are okay with his actions. That would be a gross misinterpretation of what happened here today. I told him that EPA’s attacks on ethanol don’t just hurt plants like EKAE, they hurt farmers, rural communities, and American consumers who benefit from ethanol with lower prices and cleaner air.”

Ultimately, Pruitt provided some insight into areas that could benefit ethanol, according to KCGA. Pruitt said he supported a reid vapor pressure (RVP) waiver that would allow year-round E15 sales and believes the EPA has the authority to grant it, eventually. Corn growers are waiting to see if Pruitt follows through on his promise, especially after the events that led up to the meeting.

"Early this year, Big Oil wanted relief from high RIN prices. We showed how granting year-round E15 sales through an RVP waiver would alleviate higher RIN prices. President Trump agreed, but said there would have to be a trade-off for the oil companies,” said Kansas Corn CEO Greg Krissek. “We didn’t get the RVP waiver; oil refiners got exempted from 1.6 billion gallons of ethanol use; RINs are at a five-year low and now EPA wants to kill our exports by applying RINs to ethanol exports which has legal and trade issues. We don’t see where ethanol is getting anything but played by EPA."

In South Dakota, more than 200 farmers and ethanol workers gathered to participate in a tractor rally to show Pruitt the importance of RVP parity for higher blends of ethanol above E15. The farmers broke out in a chant, “E15! E15! E15!”

South Dakota Corn Growers Association President Troy Knecht addressed the group, saying, “Corn prices right now are at a break-even or below. We’ve lost 1.5 billion gallons of ethanol to exemptions that the EPA administrator has granted to refiners. That equals about 570 million bushels of corn. When President Trump ran, he made the promise to uphold the RFS to the rule of law. It’s time for President Trump to step up and support the people that elected him and get the EPA administrator to do his job.” 

In Nebraska, Board Chairman Dave Merrell participated in a meeting with Administrator Pruitt. Merrell grows corn and soybeans on his 1,200 acre family farm. In addition to his position on the Nebraska Corn Board, he is active in the National Corn Growers Association, U.S. Grains Council, and the Nebraska Corn Growers Association.

We want Administrator Pruitt to take note of the damage he is causing to rural America,” said Merrell. “The EPA is destroying demand for ethanol and caving into big oil demands. We will not stand idly by and watch this happen. Any disruption to the ethanol industry is bad for farmers, for our nation’s economy, and for consumers in general. Pruitt needs to follow through with President Trump’s stance to grant RVP relief as well as the president’s commitment to the RFS.” 

It is clear that with many petroleum refineries blaming the RFS for their low financial performance and in some cases bankruptcy, President Trump's administration is having second thoughts about this federal program in keeping with their pro-fossil fuel approach. All the same, corn growers are mostly republican and constitute the major chunk of President Trump's voter base. It needs to be seen in the coming days how the current administration will keep both parties happy.