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

What about the SBA loans and PPP?

Skor said that yes, many ethanol plants have certainly applied for the COVID-19 relief loans and packages, but the funds were exhausted already as of Thursday morning. “We did everything we could at Growth Energy to ensure members applied and every plant that could qualify reached out to try and get funds.”

Unfortunately, she noted that not every ethanol plant qualifies due to the restrictions. She said, “Thank you for it but you need something that everything can access.”

Vilsack said that the SBA loans for ethanol plants are great, but eventually you have to repay it. “Hopefully if you maintain payroll you can get loan forgiven but how does the government help ethanol producers deal with 37 cents loss?”

Mixed messages coming out of administration made it unavailable to majority of farms, said Larew. He noted that the USDA was helpful and created FAQ to explain eligibility but regional SBA officials were saying farms weren’t eligible. “As a result, through all those delays, just this morning we were hearing clarification if a farmer could use a schedule F but those funds are all now gone.”

Bottom Line

A North Carolina farmer dumping milk 17,000 gallons of milk he used to sell to restaurants and coffee shops at an estimated loss of $160,000. Adams County Farm Bureau in Illinois donated a ton or about 2,000 pounds of pork to local food banks to help feed the sudden surge of hungry families. A Smithfield Foods meat processing plant shuts down in South Dakota as it became a coronavirus hotspot with 600 employees infected with Covid-19.

These stories are everywhere as farmers across the country come together to figure out what to do with products that used to go to restaurants and wholesale markets that now need to be diverted to consumers, grocery stores and food banks.

The Focus on Rural America press conference made it clear, it’s not an easy switch to go from producing, packaging and distributing for restaurants to food banks and grocery stores, but they are working on it. The key is innovation and adaptation now said Larew. Being able to shift storage and infrastructure to move more easily and quickly from food service to food banks for example. Diversifying farmers and fields to diversify risk is important too noted Vilsack. Judge said supporting immigrant farm and factory workers with healthcare and protection is also key at this time as they continue to work to keep things running. Another key takeaway was that conversations need continue on Capitol Hill, USDA, The White House to make sure everyone who needs support is supported.

“Biofuls is our business in Iowa and it won’t survive here without some assistance, so we need to make sure that message is heard,” said Judge. How? She suggested everyone keep calling their Senators and Congressional delegation to carry that message in hopes it gets to the top at The White House.