Many in the Iowa ag community — “myself included,” said Carroll-based ethanol executive Nick Bowdish — are supporting President Trump in taking on China in broad strategic talks, even if farmers take temporary hits through tariffs, but the goodwill is quickly evaporating over the administration’s granting of waivers to petroleum producers to relieve them of mandated biofuels blends — a move that is depressing ethanol demand and dealing rural Iowa something of a double whammy.
“For anybody in the agricultural community to decide to vote for the president with this sort of policy action, that’s a vote to cut off our economic prosperity,” Bowdish said. “The farmers that I communicate and speak with are definitely expressing to me a pause here in their consideration, and I think a lot of them are listening to people running for the Democratic ticket and what their rural vision for this country is. Several of (the farmers) may not vote for the president and may just choose not to vote at all if they don’t see an alternative.”
Bowdish, who lives in Carroll, is president and CEO of Elite Octane in Atlantic and Siouxland Ethanol in Jackson, Nebraska. He also operates Carroll-based N Bowdish Company, an ethanol-consulting company.
Top Republicans in Iowa — U.S. Sens. Charles Grassey and Joni Ernst, and Gov. Kim Reynolds — are working furiously to restore the biofuels blends required by the Renewable Fuel Standard. The EPA recently granted 31 exemptions for oil refineries allowing them to eliminate the ethanol mix, a move industry leaders like Bowdish say has reduced demand for 1.4 billion bushels of corn, and hundreds of millions of bushels of soybeans for biodiesel.
“What changed here in the last 90 days was when the president decided to issue these small-refinery waivers to some of the largest oil companies in the world,” Bowdish said. “With that action, in addition to destroying demand in all of our export markets, that action now has destroyed demand for ag products here at home in the United States, and that’s not acceptable.”
Bowdish said the uproar is not just over poor margins but also about the potential of ethanol plants shuttering. Two in Iowa — in Sioux Center and Merrill — already have.
“It’s very important to understand that there is time for the president to fix this, and the president absolutely has the authority to fix it,” Bowdish said. “Farmers and ethanol producers are not asking for anything special here. We’re simply asking for the president and the EPA to follow the law.”
The blending laws, on the books since 2005, have been administered “to a T” until the last three years, during which the waivers have “eviscerated” the intent, Bowdish said.
“Having been in the ethanol business for about 13 years, the cycle we’ve been in for the last six months is as tough as I’ve seen in the business,” Bowdish said. “The drought year we had in 2012 definitely was challenging, but during that year, the industry had the benefit of crude oil being at $140 a barrel, and energy prices were sky high.”
The times today on the Iowa farm are plagued with more anxiety-inducing factors, he said.
“We’re in an environment of $50 and $60 crude, and just completely depressed ag prices, and not just ethanol,” Bowdish said. “But corn, soybeans, milk, all these commodities that have really been challenged, beginning with the global trade discussions and all the tariffs that have done on around the world.”
Time is running out to restore and repair the damage that has been done, Bowdish said.
Reynolds said she is confident a deal can be reach with Trump for a biofuels-boosting climb in corn and soybean demand. She, Ernst and Grassley recently met with the Trump administration to discuss the issue.
“We’re waiting to see that in writing, and hopefully we’ll get that sooner rather than later,” Reynolds told reporters on a conference call Wednesday, according to The Des Moines Register. “And we’ll continue to touch base with the administration and just see where they’re at on it. But I take them at their word. It was a really, really good meeting, with a good dialogue and ideas committed to the farmers.”
Grassley said he thinks the waived biofuels gallons will be restored, but he wants to see the details, The Register reported.
“I’ve been hoodwinked so many times, not just by the EPA on this issue, but by other bureaucracies as well, so I’m going to see if what we talked about is the end product,” Grassley told reporters Tuesday, The Register reported.