Biofuels not on a level playing field – Ethanol and biofuel reactions to USDA’s $19B coronavirus farmer relief package

The Reactions

The consensus seemed to be that the USDA $19 billion program was a good start but not nearly enough and not specific enough on how it will actually reach smaller farmers that really need it. Especially given criticism over the $28 billion farm bailout that started in 2018 given to alleviate trade and tariff costs from Trump’s trade war with China and the U.S. Government Accountability Office’s review of the bailout over concerns that more of the bailout money was going towards southern states that voted for Trump and to large and foreign-owned companies rather than smaller American-owned farms.

Renewable Fuels Association

Renewable Fuels Association President and CEO Geoff Cooper said, “While we appreciate that USDA’s new program provides needed assistance to the nation’s farmers and ranchers, it is unfortunate and disappointing that the 350,000 workers supported by America’s ethanol industry were left behind.

“USDA missed a crucial opportunity to lend a helping hand to an industry that is suffering the worst economic crisis in its history. Roughly half of the ethanol industry is shut down today, as fuel demand has collapsed in response to COVID-19. Corn demand and prices have plummeted as plants across the country are idling. Jobs are being lost, grain markets are being ravaged, rural communities are being destabilized, and the long-term future of homegrown renewable fuels hangs in the balance. But even in the face of tremendous adversity, ethanol producers have stepped forward to help in the battle against coronavirus by ramping up production of high-purity alcohol for hand sanitizer and continuing to supply animal feed and captured carbon dioxide to the food supply chain.

“While today’s package is a start, more assistance will be required to help the farm sector and rural America fully recover from the devastating effects of this pandemic; we implore Congress and the administration to ensure that the ethanol industry is included in the next round of emergency relief. With each passing day, the nation’s renewable fuels sector edges closer to the brink of complete collapse. The ethanol industry needs help. We simply cannot afford to lose an industry that has become part of the fabric of rural America.”

Growth Energy

Growth Energy released a statement to The Digest saying that they thank the four governors who sent a letter to USDA asking for additional resources under the COVID-19 relief package to address the “economic harm and job losses that biofuel producers are suffering.” However, “an initial tranche of aid included welcome funding for farmers and ranchers, but no direct relief for U.S. biofuel producers,” is sure to be a disappointment for not only Growth Energy and their biofuel members but for anyone in biofuels.

“Biofuel plants are the beating heart of the rural economy, and strong support from USDA is vital to keeping U.S. agriculture intact through the worst of this crisis,” said Growth Energy CEO Emily Skor. “Ethanol production provides jobs for our communities, a market for our farmers, sanitizer for our hospitals, animal feed for livestock operations, clean fuel for our vehicles, and vital carbon dioxide (CO2) for meatpackers, and municipal water treatment. We’re grateful to rural champions like Governors Reynolds, Walz, Ricketts, and Noem who are standing shoulder-to-shoulder with America’s biofuel industry to keep our vital supply chain moving.

“As more plants are forced to close, the damage will only continue to spread. We urge lawmakers and the USDA to take immediate, additional steps that are still needed to keep our plants open and protect the economic engine that will fuel America’s recovery.”

National Sustainable Agriculture Coalition

The National Sustainable Agriculture Coalition (NSAC), tweeted on Friday, “Glad to see progress on getting needed aid to farmers – but the plan as USDA briefly outlined it tonight lacks critical details to confirm whether it will actually reach all who need it.” NSAC had joined over 750 groups earlier in April asking Perdue to directly help farmers who rely on local and regional markets.

Continue reading on the next page for a look at rural America and biofuels and what needs to be done, what about the SBA loans and PPP, and more.