After losing their biggest market for exports due to trade tensions, U.S. farmers are looking to President Trump for support in boosting biofuels. This comes as they face the possibility of having their crops go unsold and stored away. The administration plans to announce how much biofuel will be blended into fossil fuels for the next year, which is crucial for farmers who have seen a sharp decline in orders from China, the largest buyer of U.S. commodities.
Caleb Ragland, a farmer from Kentucky and president of the American Soybean Association, expressed concern over the upcoming biofuels mandate. He emphasized that without it, farmers could end up with an excess of soybeans that they cannot store. The U.S. Department of Agriculture reported that export sales of soybeans are currently down 79% compared to the average over the past five years, with corn sales also significantly lower.
The farm economy was already struggling before the trade disputes, with global crop surpluses leading to a steep drop in grain prices. Trump’s administration had previously provided a $28 billion bailout to farmers affected by trade issues and is now considering similar measures again. However, for now, the focus is on creating domestic markets to help farmers sell their crops.
Many farmers and industry groups are advocating for a higher biofuels mandate to stimulate demand. The Renewable Volume Obligation (RVO) is a key factor in this. While farmers support a higher mandate, some oil refiners oppose it, arguing that there isn’t enough gasoline demand to absorb the increased biofuels.
Agribusiness leaders, including major companies like Archer-Daniels-Midland and Cargill, are pushing for the Environmental Protection Agency to set the RVO at no less than 5.25 billion gallons for biomass-based diesel, a significant increase from previous levels. This could help revitalize the biofuels industry, which has seen production capacity decline.
Despite the push for a higher mandate, there are concerns about how the EPA will balance the interests of farmers and refiners. Farmers are hoping for a resolution that allows them to sell their crops rather than rely on government aid. Many believe that developing domestic markets is crucial for their long-term success.
As the situation develops, farmers remain hopeful that the administration will prioritize their needs and help them regain access to markets, both domestically and abroad.