House Biofuels Caucus urges Perdue to help biofuel producers

By Erin Voegele | April 10, 2020

The House Biofuels Caucus sent a letter to Agriculture Secretary Sonny Perdue on April 10 urging him to use funding from the Coronavirus Aid, Relief and Economic Security (CARES) Act to provide direct relief to the biofuels industry.

The letter notes that the legislation provided the USDA’s Commodity Credit Corp. with $14 billion. It also provided $9.5 billion for the secretary to respond to the economic impacts of COVID-19.

“Demand for fuel is declining as states implement stay-at-home orders and discourage travel,” the representatives wrote. “This sudden shift in demand is worsening market conditions to the point ethanol plants are halting production. The biofuels industry is a vital market for the commodities our farmers produced, and USDA must take immediate action to ensure plants can retain skilled workers and continue production when market conditions improve.”

The letter stresses that the biofuels sector provides a direct and significant boost to the value of corn and soybeans. “Ethanol plants purchase two out of every five bushels of U.S. corn and biodiesel producers use over 8 billion pounds of soybean oil a year. Ethanol plants produce dried distillers grains (DDGs) as a byproduct, providing livestock farmers with a low-cost, high-protein component of animal feed. To assist with the response to COVID-19, some ethanol and biofuels plants have volunteered to produce hand sanitizer and disinfectant products to address nationwide shortages. And ethanol plants produce high purity carbon dioxide that is critical for medical facilities food processing. The biofuels sector plays a large role in the livelihood of America’s commodity and livestock producers, and biofuel plants are major employers in many rural communities.

“USDA should take immediate action to stabilize the biofuels industry with resources provided by the CARES Act,” they continued.

The Renewable Fuels Association thanked the House Biofuels Caucus for standing up for the renewable fuels industry, noting that nearly 40 percent of the ethanol industry’s production capacity is currently offline.

“On behalf of the nation’s ethanol industry, farmers across the county, and consumers who depend on the clean fuel and nutritious feed ethanol plants produce, I want to thank these congressional leaders for their vision and advocacy,” said Geoff Cooper, president and CEO of the RFA. “The twenty-nine Members of Congress who signed this letter recognize the important role ethanol plays in the economic stability of rural America, and they understand it is a necessity to support farmers and commodity markets by allowing funds recently allocated to USDA to protect the ethanol industry’s workforce. Even as gasoline demand is devastated by national and global stay-at-home orders, ethanol remains the single most important value-added market for farmers. We cannot allow this critically important industry to be further imperiled, and these House members should be applauded for their efforts to protect the 350,000 jobs supported by the ethanol industry.”

Growth Energy also welcomed the letter from the House Biofuels Caucus.

“We’re grateful for the relentless efforts of House leaders to protect the farmers, biofuel workers, and rural businesses hit hardest by this crisis,” said Emily Skor, CEO of Growth Energy. “Biofuel plants across the country have been forced to halt production, and the spike in unemployment and loss of farm income is crippling rural communities. The USDA should act quickly to deliver the relief approved by Congress and protect the economic engine that will fuel America’s recovery in the months ahead.”

The letter is signed by Reps. Collin Peterson, D-Minn.; Roger Marshall, R-Kan.; Dave Loebsack, D-Iowa; Rodney Davis, R-Ill.; Cheri Bustos, D-Ill.; Steve King, R-Iowa; Mike Bost, R-Ill.; Dusty Johnson, R-S.D.; Jim Hagedorn, R-Minn.; Abby Finkenauer, D-Iowa; Darin LaHood, R-Ill.; Jason Smith, R-Mo.; Steve Watkins, R-Kan.; Blaine Luetkemeyer, R-Mo.; Don Bacon, R-Neb.; Jeff Fortenberry, R-Neb.; Emmanuel Cleaver, II, D-Mo.; Sam Graves, R-Mo.; Cindy Axne, D-Iowa; Tom Emmer, R-Minn.; Mike Turner, R-Ohio; Mark Pocan, D-Wisc.; Marcia L. Fudge, D-Ohio; Ann Wagner, R-Mo.; Ron Estes, R-Kan.; Ron Kind, D-Wisc.; Angie Craig, D-Minn.; Vicky Hartzler, R-Mo.; Adrian Smith, R-Neb.; Adam Kinzinger, R-Ill.; Greg Pence, R-Ind.; and Jim Banks, R-Ind.

A full copy of the letter can be downloaded from Peterson’s website.