Biofuels

The New Biofuel Boom? Historic RFS Mandates Drive 2 Billion-Gallon Expansion

Thu, 02 Apr 2026 17:22:41 GMT

The EPA’s finalized “Set 2” rule under the Renewable Fuel Standard is doing something rare in U.S. biofuel policy: it is not just stabilizing the market, it could jolt it.

With blending mandates for 2026 and 2027 set at historic highs , including a more than 60% jump over 2025 levels for biomass-based diesel, the rule is already being read across the industry as a catalyst for a new expansion cycle — one that could ripple from fuel producers back to soybean fields, livestock operations and emerging oilseed crops.

A Demand Shock, But By Design

“It sure feels like it,” says Matt Upmeyer, director of feedstock sourcing and strategy at Montana Renewables, when asked whether the policy signals the next biofuel boom. “We received a strong RVO, adding about 2 billion gallons of biomass-based diesel demand, and that’s a huge increase. And certainly feedstock demand is growing as well. That 2 billion of biomass-based diesel represents about 15 billion lb. of feedstock for the biodiesel and renewable diesel producers. And that really translates directly back to farm and agriculture growth as well.”

From Underperformance to Full Throttle

For an industry coming off a sharp downturn, where biodiesel production fell significantly in 2025 and facilities idled or slowed, the scale of the mandate is not just notable — it is corrective.

“I mean, I think it is realistic,” Upmeyer says of the aggressive growth targets. “The industry is poised to meet that demand. We’ve got capacity. The renewable industry, which is both biodiesel and renewable diesel, has a combined capacity of probably around 7 billion gallons. So meeting that mandate, I don’t think is a problem.”

But meeting it will require a fundamental reshuffling of how feedstocks move through the system.

“We will definitely see some changes and shifts in the feedstock flows,” he says. “We talked a little bit about the soybean oil increase and the production of soybean oil through crush. I think also you’re going to see the tallow industry and choice white grease, the hog industry, as well as poultry fat — all of those are going to find their way into the renewable diesel and biodiesel in a greater way. I think we’ll maximize all of the available low-CI feedstocks, including distillers corn oil. And then from there, obviously, the demand will be filled with soy.”

That expansion does not stop at just soybeans. Upmeyer says there are other crops that stand to benefit from this newly released RFS.

“I think that as we expand the amount of biomass-based diesel we produce, we’re going to start looking to other feedstocks as well. So canola, there’s a fair amount of canola grown in the United States, and certainly our neighbors to the north are large canola producers,” Upmeyer says. “I think that will become an integral part of what we do. And then there’s other low-CI feedstocks that are sort of on the cusp, things like camelina and different things like that will get attracted new attention right now to see how they may fit into the future mandates and production.”

If you look at the past year, biodiesel and renewable diesel facilities reportedly shut down or ran well below capacity in 2025, which led to a one-third drop in U.S. biodiesel production compared to 2024.

When asked if these new RVOs from EPA will reverse that trend and give them enough confidence to bring that production back online, Upmeyer says it should.

“The biodiesel industry got hit hard. Their production costs are higher than renewable diesel, and so they certainly felt that when we had a lower RVO under the Set 1 rule. I think we’re getting close to a point where these plants will start back up. Margins have improved dramatically.”

He adds nuance to that recovery, noting cost pressures still linger.

“Biodiesel producers have a slightly different process than renewable diesel,” he says. “They take fats, oils and greases, combine them with methanol and catalysts to make biodiesel. And methanol costs have shot up, right? So I think the marginal producers on biodiesel are still probably not super inclined to start up, but certainly the integrated biodiesel plants will be running hard. And I do believe that even the marginal biodiesel players will get a chance to restart those assets in the near term.”

A Policy Twist: The Half-RIN Question

One of the most debated elements of the rule — the proposed “half-RIN” provision for 2028 — adds another layer of complexity, particularly for feedstock sourcing and trade.

“We just couldn’t get our heads around the administrative burden that might be associated with a half-RIN,” Upmeyer says. “How do you account for feedstocks coming in from some Canadian origin, some domestic, some from foreign sources? So I think there was an administrative burden that was certainly problematic.”

“This is certainly in line with the administration’s desire to maintain energy independence in the U.S. and to have a U.S.-based and U.S.-centric market for our crop inputs and fuels,” he says. “So I think there were a lot of things that went into this. But at the end of the day, it’s still on the table for 2028. I don’t think there’s clear guidance yet, but it certainly left that door open to address this issue in the Set 3 rule.”

A Win for Agriculture

When asked if he would classify this is a “win for U.S. agriculture,” Upmeyer said the immediate impact of the record-high blending mandates for 2026 and 2027 is already clear to those closest to the supply chain.

“I think it’s a great win,” Upmeyer says. “Again, we’re really underpinning the demand for soybeans and crush. We’ve got a strong demand for the rendered products that come from the beef industry and hog industry. So, I think this is a win for agriculture and for the renewable fuels industry. We certainly applaud the administration’s commitment to energy independence, to the renewable space and ultimately to agriculture.”

White House Sets Record Biofuel Volumes for 2026 and 2027

Fri, 27 Mar 2026 18:27:37 GMT

In the 20th year of the Renewable Fuel Standard (RFS) program, the White House has established the renewable fuel volume requirements for 2026 and 2027 at the highest levels in program history. The Set 2 final rule, announced at the White House Great American Agriculture Celebration in front of 650 invited attendees, realigns the program with Congress’ intent to increase the use of homegrown American biofuels.

“Today’s announcement is truly historic for our nation’s farmers and energy producers. These numbers represent the highest levels of biofuels ever required to be blended into our fuel supply,” says Brooke Rollins, Secretary of Agriculture. “With President Trump and Administrator Zeldin’s leadership, these historically high volumes are expected to create a $3 to $4 billion increase in net farm income. The Renewable Fuel Standard Set 2 Rule will create a $31 billion dollar value for American corn and soybean oil for biofuel production in 2026, which is $2 billion more than in 2025. Our farmers are stepping up to grow American energy dominance.”

Just this week, EPA renewed emergency waivers for E15 gasoline sales during the summer driving season.

What Does the Set 2 Final Rule Mean for Farmers

To meet the 2026 and 2027 volume levels, EPA estimates biodiesel and renewable diesel production and use will need to increase by more than 60% versus 2025 volumes. The increase was above the initial proposal.

“The proposal that we saw nine months ago was extremely robust,” explained Kurt Kovarik of the Clean Fuels Alliance America. “In fact, our industry, along with the petroleum sector and the soybean growers, asked for a volume requirement for 2026 of 5.25 billion gallons. They proposed 5.61 billion gallons. And today’s proposal is right in that neighborhood between 5.5 to perhaps as high as 5.6 or 5.7. There’s a little bit of math yet that needs to be done.”

He said that in 2025, biodiesel and renewable diesel facilities were forced to shut down or run far below prior-year production levels due to market uncertainty. U.S. biodiesel production declined by one-third in 2025, compared to 2024.

“Biodiesel and renewable diesel represent 10% of the value of every bushel of U.S.-grown soybeans, contributing to President Trump’s desire for American energy dominance and domestic market demand for agriculture commodities,” said Kovarik. “American farmers and other feedstock providers are eager for the growing domestic clean fuel market to drive value in agriculture, along with economic growth and job creation in rural communities. American consumers are desperate for secure, affordable domestic energy. Today’s rule is a clear win for the nation’s energy security.”

With the benefits Set 2 will bring to America’s farmers, EPA estimates the rule will generate more than $10 billion for rural economies and create more than 100,000 new jobs in the agricultural and manufacturing sectors. To provide continued certainty for American corn growers and ethanol producers, EPA will maintain the 15 billion conventional biofuel level for 2026 and 2027.

Based on EPA’s latest release on March 27

(EPA)

What are Renewable Volume Obligations?

RVOs are targets set by EPA to determine how much renewable fuel must be blended into the U.S. transportation fuel supply. EPA determines the total volume of different categories of biofuels that should be used in the country for multi-year periods. Once decided, EPA converts the total volumes into percentage standards, which represent the ratio of renewable fuel to the total amount of gasoline and diesel expected to be consumed in the U.S. that year.

Each “obligated party,” typically refiners and importers of gasoline and diesel, calculates its RVO by multiplying EPA’s percentage standards by the total volume of non-renewable gasoline and diesel they produce or import. To prove they have met their RVO, obligated parties must use a serial number attached to each gallon of biofuel, known as Renewable Identification Numbers (RINs). When the biofuel is blended into the fuel supply, the RIN is “separated” from the physical fuel.

At the end of the compliance year, obligated parties must submit to EPA enough RINs to cover their specific RVO. If a refiner blends more biofuel than required, they can sell their excess RINs to other refiners who have not met their obligations.

Adjusted Small Refinery Exemptions

The EPA also finalized the reallocation of the volumes from Small Refinery Exemptions from 2023 through 2025. Those are now set at 70%.

“Adding it to the top line volume for 2026 and 2027, the volumes that were waived over those three years will be made up in 2026 and 2027,” Kovarik. “For our industry, that’s somewhere between an additional 200 to 250 million gallons a year.”

He says that is on top of the already robust minimum volume that EPA set. The agency claims the RFS rule will create $31 billion in value for American corn and soybean oil.

Renewable Fuels Association (RFA) President and CEO Geoff Cooper noted that while they advocated for full reallocation of the 2023-2025 SREs, the 70 percent reallocation included in today’s rule is better than other options that were under consideration. EPA had proposed 50 percent reallocation as an option and also solicited public feedback on no reallocation at all.

“We continue to believe small refinery exemptions are completely unjustified, and the SRE petition process—including EPA’s reliance on the Department of Energy’s ‘scoring matrix'—is fundamentally flawed,” Cooper said. “SREs distort the market, undermine fair competition, and destabilize the RFS program. And while RFA appreciates EPA’s efforts to minimize market disruptions by reallocating most of the renewable volume lost to SREs, we believe the Agency has a duty to fully restore all exempted volumes.”

RVO Reaction Pours In

The Renewable Fuels Association (RFA) and other farm groups applaud the RVO announcement from EPA.

“Today’s RFS rule supports continued growth in American-made renewable fuels like ethanol and brings much-needed certainty and stability to the marketplace,” said RFA on X.com .

Today’s RFS rule supports continued growth in American-made renewable fuels like #ethanol and brings much-needed certainty and stability to the marketplace. We are grateful to @POTUS and @epaleezeldin.https://t.co/FdovzBqLUr
— Renewable Fuels Association (@EthanolRFA) March 27, 2026

“Congress intended year-to-year renewable fuel blending to increase under the RFS and today’s announcement with the highest-ever volume obligations helps fulfill their intention,” said Brian Jennings, CEO for American Coalition for Ethanol. “We’ve consistently advocated for strong final blending obligations for 2026 and 2027, reflecting the full potential of the RFS and ensuring small refinery exemptions (SREs) do not erode demand for renewable fuels.”

Jennings says the integrity of the RFS depends on ensuring volume obligations translate into real-world demand. Any gap between required volumes and actual blending undermines the program and creates uncertainty for ethanol producers, farmers, and rural communities.

“We appreciate President Trump, Administrator Zeldin and Secretary Rollins for delivering strong RVO volumes and doing so in a way that recognizes the importance of American farmers,” said NSP Chair Amy France, a farmer from Scott City, Kan. “These volumes provide critical certainty for sorghum producers and help strengthen demand across the biofuels sector.”

NSP also highlighted EPA’s decision to reallocate 70 percent of previously exempted volumes, helping ensure that promised demand is realized.

“Maintaining the integrity of the Renewable Fuel Standard is essential,” France said. “Reallocating those gallons helps protect the market opportunities farmers depend on. We need to build on this momentum and get year-round E15 across the finish line.”

Ohio farmer and National Corn Growers Association President Jed Bower, who was present at the White House for the announcement, also weighed in on the latest volumes.

“Our deep thanks go to President Trump and Administrator Zeldin for releasing these robust RVO numbers in an exceptionally timely manner and, appropriately, during an event honoring America’s farmers. This action provides certainty to corn farmers across the country who rely on a stable biofuels industry. Today’s announcement, coupled with the Trump administration’s E15 summertime waiver earlier this week, is a positive move for the nation’s corn growers who are navigating an exceptionally difficult economic environment. There is still more to be done to help our growers, and we look forward to working side-by-side with the president and our allies in Congress to get permanent year-round E15 legislation over the finish line.”

Fuel and Fertilizer Costs Surge

While there’s hope that embracing biofuels can help bolster the farm economy and lower prices at the pump, farmers are feeling the fallout of higher oil prices. According to AAA on Friday, the national average for a gallon of diesel fuel was $5.38. That’s nearly $2 per gallon higher than it was just a year ago, and it’s happening right as farmers gear up for the spring planting season.

“To help lower gasoline prices for farmers and consumers, this week, I issued an emergency order to allow immediate sales of E-15 — and just as I promised in the campaign, I’m seeking Congressional action to allow E-15 all-year-round,” said President Trump.

Fertilizer prices are also significantly higher in the last few weeks. While some farmers pre-applied acres last fall and others bought earlier in 2026, there are still a number of acres left to cover.

President Trump to Announce Actions to Help U.S. Farmers on Friday

Thu, 26 Mar 2026 15:33:25 GMT

President Donald Trump on Thursday said his administration will announce actions to help U.S. farmers on Friday, as the White House prepares to host hundreds of farmers, ranchers and executives for an event highlighting the agricultural sector.

.@POTUS Trump LOVES America's farmers and our farmers LOVE him back!!

Our Administration is working around the clock to to deliver real relief and boost the farm economy and make necessary long term structural changes to our trading relationship, putting our farmers first.… pic.twitter.com/bVGgdzFfna
— Secretary Brooke Rollins (@SecRollins) March 26, 2026

The move comes as the administration is expected to release long-awaited biofuel blending quotas under the Renewable Fuel Standard, a policy closely watched by corn growers, ethanol producers and oil refiners that dictates how much renewable fuel must be mixed into the nation’s gasoline and diesel supply.

Reuters reported that the Trump administration will release its 2026-27 biofuel blending volume obligations this week, according to two sources familiar with the matter. The rule will not differ materially from volumes proposed by the EPA prior to the onset of the Iran war , the sources said.

Trump, speaking to reporters at a cabinet meeting on Thursday, said U.S. farmers had been mistreated by some countries and touted the multibillion-dollar bailout farmers received to help offset losses related to tariffs .

The biofuel decision ‌comes ⁠at a fraught moment for both the oil and farm sectors, with the White House balancing pressure from refiners worried about gasoline prices and farmers counting on stronger biofuel demand to support crop markets.

(Reporting by Steve Holland, Doina Chiacu and Humeyra Pamuk; Editing by Daphne Psaledakis and Caitlin Webber)

Farm Groups Say Increased Demand is the Solution to the Farm Economic Woes, Not Aid

Tue, 03 Mar 2026 20:47:37 GMT

After three years of low grain prices and low profitability, the nation’s commodity groups share a common priority for the year ahead: finding new demand sources, both internationally and at home.

While they are appreciative of recent farm aid, they want to get their income from the marketplace.

NCGA Pushes for Year-Round E15

For corn growers, that means securing year-round E15. Neil Caskey, CEO of the National Corn Growers Association (NCGA), says this is a vital tool for producers.

“This is going to be the most expensive corn crop in U.S. history. And so we’re looking for ways to keep them afloat,” Caskey says. “E15, in our opinion, is probably the easiest thing that Congress could do to signal that they understand our concern.”

Recent efforts to pass E15 failed. Additionally, a task force of biofuels and petroleum interests working on a compromise missed its February deadlines.

“I think that they’re starting to realize what we already knew. It takes a lot of time to find compromise on complex biofuels policy,” Caskey says.

Still, the group continues to push because its analysis indicates it will move the needle.

Caskey also says full implementation of E15 could eventually result in another 2.5 billion bushels of corn demand.

NCGA Backs USMCA Renewal

Caskey notes trade is the other critical demand component. This is why the renewal of USMCA is important, and NCGA supports a trilateral agreement.

“I think that we’ve got a really good deal in USMCA in its current form,” Caskey says. “So, I would urge the president and the administration to start there and extend that. And so that would certainly be our preference. But the single most important thing to us is ensuring that we maintain access to the Mexican and Canadian markets for U.S. corn.”

NAWG Also Backs USMCA

The nation’s wheat growers also support USMCA to boost exports. Sam Kieffer, CEO of the National Association of Wheat Growers (NAWG), says the relationship with North American neighbors is vital.

“Mexico is the No. 1 export destination of U.S.-grown wheat,” Kieffer says. “So we certainly want to make sure we keep that relationship strong and going — and Canada’s a great partner as well.”

NAWG Asks for Food For Peace Certainty

Kieffer says while new trade deals are needed, they are also building markets through the Food for Peace Program. They want Congress to move the program to USDA as part of the farm bill.

“USDA knows how to deal with farm commodities. USDA is already in the business of engaging in food aid programs globally. They have the infrastructure, they have the personnel and they understand agriculture. So the farm bill that is ready to be moved in the House here soon has a provision that would include that,” Kieffer says.

And he says a long-term farm bill is needed to provide certainty to farmers and offer a safety net. They’re excited the House Ag Committee started its markup on March 2.

“The One Big Beautiful Bill did make some significant investments for the future, but there’s three years of market loss that our growers are struggling with at the moment, and they’re making hard decisions and some of them are reducing acres, some of them are letting land go and there’s a price to be paid for that as well,” Kieffer says.

Long-Term Trade Deal With China

For U.S. soybean producers, the trade relationship with China is critical. They are seeking a long-term agreement in writing when national leaders meet in April.

“We’re urging the Trump administration to make sure that we lock in, you know, a stable agreement with China,” says Steve Censky, chief executive officer for the American Soybean Association. “We had the 12 million metric ton commitment for this marketing year. We’d love to see that go up. If that went up by another 8 million tons, we would welcome that. And then of course there’s the commitment for 25 million metric tons for each of the next three years’ minimum purchase requirements.”

SCOTUS Tariff Ruling Presents No Threat

Censky’s not concerned with the Supreme Court striking down the IEEPA tariffs or that President Trump’s new tariffs will take away the leverage the U.S. has with China.

“The tariffs, of course, add to uncertainty in the whole trading relationship. But again, you know, I think the president talks about what a good relationship he has with President Xi, which is wonderful. And so we’re hoping, you know, that he will be able to have a deal with China that will be positive for soybean growers,” Censky says.

Diversifying Trade

While China imports more soybeans than the rest of the world combined, ASA is also looking at diversification of their exports.

“Trade remains so important to soybean farmers. We export over half of what we produce, and we’re still very much dependent on opening up foreign markets. So through the stabilizing, making sure that we’re keeping trade on a stable plane with China, is very important, but also opening up new markets is very important to us,” Censky says.

ASA Eyes Increased Biofuels

Increasing biofuels demand is also a top priority for ASA. The group is pleased the Renewable Volume Obligations (RVOs) moved to the Office of Management and Budget (OMB) this week.

“EPA has proposed the highest volumes on record, and we want to make sure that in the final rule that’s adopted that those are brought home. Because that’s so important to soybean demand, soybean prices, but also the demand for the oil produced from soybeans. Over half of the oil that’s produced from soybeans goes into biofuels,” Censky says.

Censky says the EPA proposal for 5.6 billion gallons of biomass-based diesel would add 2 billion gallons to current levels.

“It would be over a 60% increase. We really think that in the previous RVOs that were set under the Biden administration, they really underestimated the capacity for us to produce,” Censky adds.

NSP Supports E15

The National Sorghum Producers (NSP) is also focused on biofuels, including E15. Tim Lust, CEO of NSP, says the industry needs an immediate boost.

“We need the demand now. With the softness in prices and profitability across all commodities, it’s something,” Lust says. “It’s one of the few things that we could do that would have an immediate impact that is good for farmers, good for demand, good for saving the government money.”

He says they hope Congress can find a legislative vehicle to move the policy forward soon.

“Obviously, we need a deal. We want a deal. Exactly how that goes is something that’s still got to be threaded through Congress. Nothing gets passed through Congress simply today,” Lust adds.

NSP Supports Trade

Sorghum producers are also looking to exports. While USMCA is key, they are also excited about new trade opportunities.

“From an international standpoint, where’s the trade opportunities and what’s that look like? [There are] a lot of new agreements going on. And so for our industry, it’s about that market access and long-term market access,” Lust says.

NSP is eyeing two of the world’s largest populations for the most immediate impact on sorghum demand.

“Most years we do about $1 billion worth of trade with China. So, it’s certainly a significant item. In the last about eight or nine weeks now, they’ve bought about 40 boats, and so certainly that’s very influential to our industry. One you know, the one with long-term potential for us is the India agreement, and sorghum being mentioned in there is important from a long-term [perspective],” Lust adds.

This industry-wide push for increased demand aims to secure better long-term prices for the nation’s grain producers.

RVO Crossroads: How EPA’s Biofuel Decision Could Reshape Grain Markets This Spring

Fri, 27 Feb 2026 21:41:51 GMT

At Commodity Classic this week, the biofuels debate moved from Washington talking points to farm-gate math. With EPA’s proposed Renewable Volume Obligations now sitting at the White House for review, the outcome is poised to ripple through soybean oil crush margins, renewable diesel run rates and, ultimately, how many acres farmers devote to corn and soybeans this spring.

During a live taping of U.S. Farm Report, analysts Arlan Suderman of StoneX, Chip Flory of AgriTalk and Naomi Blohm of Total Farm Marketing by Stewart-Peterson made it clear: this isn’t just about percentages on a policy sheet. It’s about whether renewable diesel plants jump from 60% to near full capacity, whether USDA’s 17-billion-pound soybean oil forecast proves tight, and whether growers need to “buy acres” before planters roll.

In a market perched at technical resistance and staring down seasonal headwinds, timing may matter as much as the final RVO number. A bold, immediate reallocation of small refinery exemptions could ignite demand and shift acreage battles overnight. A slower rollout, or even delayed clarity, could leave spring planting decisions hanging in the balance.

Five Scenarios and a Need for Certainty

“There’s plenty of talk, but we don’t know for sure,” Suderman says of the pending RVO announcement. “But we have some ideas on what it’s going to be.”

After years of small refinery exemptions (SREs) hanging over the market, EPA has now cleared exemptions dating back to 2016. That removes what Suderman described as a lingering weight on the industry. But the key question now is reallocation.

“There’s about five different scenarios that could still come out of this,” he explains. “So there is a lot of variability.”

The most widely discussed outcome would reallocate 50% of exempted volumes back to larger refiners. But Suderman noted that number could reach 75%, and some industry participants still hope for 100%.

“What we expect to happen is 50%, possibly up to 75% of the small refinery exemptions would be put back in for larger refineries,” he says. “Now what we don’t know is over how many years that’ll be. Will it be over one year, two years or four years? So that makes a big difference.”

Another unresolved issue is the RIN credit for imported feedstocks.

“What we don’t know is what will they do with the 50% RIN credit for imported feedstock,” Suderman says. “There’s a lot of pressure to move that back up to 100%. It could be something in between. It could be one year it’s one thing, the other year it’s another.”

Despite the uncertainty, Suderman sees most scenarios as constructive.

“Regardless, we see most all the possible scenarios here as being positive,” he says. “The biggest thing is not what the numbers say, but just having certainty.”

And once that certainty arrives, the production response could follow quickly.

“It’s going to take 45 to 60 days, we feel like, to really get the industry going,” he says. However, with RIN values rallying, “yesterday we got RINs up high enough that we can start profitably making renewable diesel. So we may ramp it up a little bit quicker.”

Suderman expects a finalized decision from EPA by the end of March , which is a timeline even EPA has stated.

Even 50% Is a Win?

Flory has been in direct conversations with biofuel leaders at Commodity Classic, including representatives from the Renewable Fuels Association and Clean Fuels Alliance America.

“The buzz is that it’s going to be half,” Flory says. “Sometimes the buzz isn’t right… Could be up to 75%. I think there’s still hope that it is going to 100%.”

But even at 50%, he sees progress.

“In my mind, with the way the trend was going, even at 50% reallocation, I’m going to call it a win for the industry,” Flory says.

He emphasizes that the RVO ruling outweighs other ethanol policy wins.

“The RVO decision, I think, is so important,” he says. “It’s more important in my mind than E-15 getting it done.”

The reason is immediate demand potential. Biomass-based diesel refiners have been operating at sharply reduced rates.

“They were running at what, Arlan, 60% capacity?” Flory asked during the discussion. “If we all of a sudden have to ramp this back up to 90%, 95%,” Flory continues, “we’re going to use all 17 billion pounds of bean oil in the year ahead that USDA says we’re going to.”

Markets Sitting at Resistance

Blohm believes the market has already begun factoring in future biofuel demand, but she questions how aggressively policymakers will move.

“If we came out with this information and they said it’s going to be full bore, sooner than later, the market still could respond with higher values,” she says

However, she also pointed to inflation sensitivities.

“There’s also the balance of governments wanting to not have food prices go too high too quickly,” Blohm says. “Especially with this administration still trying to bring beef prices down. So I don’t know that they’re going to immediately give us all of this great news that we’re wanting.”

Instead, she expects a more gradual rollout.

“I’m on the slow roll carryout, which would be bringing that demand up, but slowly over time,” she adds.

Technically, she sees the grain complex at a critical tipping point.

“We’re right at a perch for market prices right now,” Blohm says. “Corn, beans, wheat — all near some short-term major resistance levels where we’re waiting for fresh, big new news.”

If that news comes, either from biofuels or South American weather, the move could be sharp.

“If we can get some new bullish news, either bad weather on the safrinha crop, great news regarding the biofuels, we have reasons for this marketplace to explode higher,” she says. “If we do not get good news soon, seasonals could kick in, when prices often soften into late March. The timing of this is critical. Timing is critical.”

Acreage Wild Cards: RVOs and China

The RVO decision intersects directly with planting intentions and potentially with U.S.-China trade talks expected in April. Suderman points to both as pivotal acreage drivers.

“Two big critical factors that will impact planting intentions are the RVO and trade deal with China,” he says.

If both land favorably, soybeans may need to compete for ground.

“If both of those come in favorable, we could see soybeans having to buy acres,” Suderman says.

But timing complicates the picture. USDA surveys for the March Prospective Plantings report close around mid-March.

“Most of the surveys come in front-loaded,” Suderman noted. If policy clarity arrives after surveys are returned, “we’ll be waiting until the June survey to really feel like we have a handle on the number of planted acres.”

Blohm questioned whether corn acreage will ultimately exceed early USDA projections.

“My thought would be that we’re going to plant less corn than last year,” she said. “But is it going to be 94, 95 or 96? That’s the question.”

Even at those levels, balance sheets remain comfortable without stronger demand.

“With 94, 95, 96 million acres, including trendline yield, as good as demand is, you’re going to have carryout for corn near 1.8, 1.9 or 2 billion bushels, unless we can get some of this renewable stuff happening fast,” says Blohm.

How Much Demand Is Enough?

Flory acknowledged that the corn market has already built substantial usage.

“We’re already looking at $16.4 billion in total demand. That’s a huge number,” he says.

To materially shift prices, though, he says additional growth is needed.

“Looking forward, what does it take? We need to see that shift in demand,” Flory says. “Add another 300 million bushel, 400 million bushels of demand. We can do that if we can get some of these biofuel priorities.”

Are Grains the Bargain Buy?

Beyond domestic policy, outside markets could amplify moves.

“If things flare up with Iran, that’s going to be a game changer for crude oil,” Blohm says. “Which would pull corn prices higher.”

She’s also monitoring palm oil production in Malaysia.

“They’re having too much rain right now, and that’s affecting production,” she says. “If they’ve got lower production, then maybe we see a kick up for soybean oil demand here.”

Suderman added a macro lens, noting that grains and oilseeds have shown strong historical correlation with inflation measures.

“When you look at what the funds want to own if we see a return of inflation pressures, the highest correlation over the last 10 years has been the grain and oilseeds to the CPI, followed by energy,” says Suderman.

A Decision Landing at Planting

The EPA’s RVO decision is expected within weeks — right as planters begin to roll.

If policymakers deliver aggressive reallocation and clarity, renewable diesel plants could ramp from 60% toward full capacity. Soybean oil demand would tighten. Soybeans could push to buy acres.

If the announcement disappoints, or even arrives too late, seasonal pressure could dominate the spring trade.

As Suderman put it, the issue isn’t just the final percentage.

“The biggest thing is not what the numbers say,” he says. “It’s having certainty.”

For farmers making planting and marketing decisions in real time, that certainty can’t come soon enough.

What the Treasury’s Announcement on 45Z Tax Credits Means to Farmers

Tue, 03 Feb 2026 22:56:54 GMT

On Feb. 3, the Treasury Department confirmed farmers will have a seat at the table to benefit from 45Z tax credits with its release of a 170-page document stating its proposed rule.

“They made a bunch of clarifications for the biofuel producers today — who qualifies, what qualifies, how to calculate and how to register,” says Mitchell Hora, an Iowa farmer and founder of Continuum Ag. “It says farmers are going to a have a seat at the table, too, which is what we’ve been advocating for this whole time.”

There have been questions over the past nearly four years since 45Z was first proposed as a biofuel producer tax credit based on carbon intensity of feedstocks. It’s had iterations through the Biden administration’s Inflation Reduction Act, and now the Trump administration’s “One Big Beautiful Bill.”

As written in the proposed rule, biofuels feedstocks would be limited to be sourced from the U.S., Canada and Mexico.

“Clearly, the Treasury has been very concerned about foreign feedstock, especially foreign used coconut oil and palm oil,” Hora says.

For farmers, three big questions remain.

1. What’s the model used to calculate carbon intensity?

Before today’s announcement, there were two competing models, one from the Department of Energy (known as GREET) and one from USDA announced last January. Today, the Treasury confirmed it’ll be a model from USDA, though it’s a new version now called 45Z FD-CIC.

“It’s going to be something different altogether, which is a combo of the two,“ Hora says. “We don’t know all the details yet, but we know they are going to utilize the language from USDA regarding verification, traceability and audits.”

Hora expects the model to use ag practices in its calculations, including cover crops, reduced tillage, fertilizer efficiency, manure and yield.

As for when the final USDA-driven 45Z FD-CIC will be released, Hora says ‘hopefully soon.’

2. Which chain of custody methodology will be used?

Hora is advocating for book and claim, which he says is more straightforward and would allow a farmer to sell their crop based on the carbon intensity (CI) score of a field, avoiding identity preservation or blending. The alternative is mass balance.

“The big thing that we want to see happen in the USDA rules is that the farmer data should be accounted for via a book and claim,” he says.

3. How much is this worth to the farmer?

Hora says today’s announcement clarifies a lot of the rule for the biofuels producer, which is the recipient of the tax credit. How much of that value will be shared with the farmer is still unknown.

“We’ve shown that farmers could contribute an average CI reduction of 18 CI points, which could translate to pretty substantial value, upwards of close to a dollar a bushel,” he says. “That’s to the ethanol plant, though. The biofuel producer gets the money. A farmer would get a portion of that, and we don’t know how the pie is going to be split, but the total pie that the farmers could contribute to, under the current models, the math ends up being $1.08 per bushel.”

While today’s announcement doesn’t mean money will start moving, Hora says we’re closer than ever to having opportunities for farmers.

Moving Forward With What is Known

Hora says while those questions have yet to be answered, he knows record keeping is paramount to seize on the opportunity. As such, he’s encouraging farmers to get their field-level data in order, including as applied maps, receipts, shape files, aerial imagery, etc.

“At least we got clarity today that this thing is going to happen. [There’s] still a process ahead, but farmers have a seat at the table. It’s a huge day for American ag,” Hora says.

Industry groups reacted in support of the Treasury’s proposed rule.

“Treasury’s proposal is a definite step in the right direction and will allow corn growers to transition into and supply the aviation sector,” Ohio farmer and National Corn Growers Association President Jed Bower says in a news release. “Being able to fuel commercial planes with fuel derived from corn would be important to the long-term economic viability of farming. After today we are one step closer to that possibility.”

The American Soybean Association (ASA) and the National Oilseed Processors Association (NOPA) sent a joint release emphasizing how the 45Z rule should be in conjunction with a final Renewable Fuel Standard (RFS) blend target announcement.

“Updating federal biofuel policies to prioritize soy-based fuels is a key ASA priority, and we applaud Treasury for this action which will help build domestic markets for U.S. soybeans,” says Scott Metzger, ASA president and Ohio farmer. “While Treasury’s work to update tax guidance is critical, ASA strongly urges the administration to immediately finalize RFS blending targets that complement the work of Treasury and Congress, by setting robust biofuel volumes and implementing new policies that will prioritize the utilization of U.S. soybeans in production.”

“These policies work hand in hand,” says Devin Mogler, NOPA president and CEO. “Treasury’s updated 45Z guidance is an important step forward, but it must be reinforced by finalizing the RFS as proposed. A strong RFS that includes the import RIN reduction mechanism is critical to putting American farmers and rural manufacturing first and providing the certainty our industry needs to continue to invest and grow so we can crush more soybeans right here in the U.S.”

What President Trump's Support Means for E15 and Corn Farmers

Thu, 29 Jan 2026 03:29:29 GMT

While speaking in Clive, Iowa, on Tuesday , the president said the passage of E15 will happen.

“I did. I promised E15 year-round if I got elected,” he said. “I want to let you know we’ll start right now.”

Trump said he is trusting House Speaker Mike Johnson and Senate Majority Leader John Thune to broker a deal in Congress.

“We’ve got it for farmers, consumers and refiners, including small and midsize refiners. In other words, to get E15 approved, and they’re working on it, they’re very close to getting it done. I just wanted to let you know that,” he added.

President Would Sign E15 Bill Immediately

USDA Secretary Brooke Rollins said in a press release Tuesday evening that “yet again President Trump is honoring his commitment to America’s farmers and energy producers today in Iowa by announcing his support for the nationwide year-round sale of E15. As Congress continues to work through the details, the president has been clear — get a bill that allows nationwide E15 to his desk, and he will sign it to unleash American homegrown row crops for biofuels use like never before.”

Iowa Biofuels Groups Say President’s Support is Critical

Iowa biofuels groups, including the Iowa Renewable Fuels Association (IRFA), took out ads and wrote President Trump a letter prior to his visit to urge his support for E15. IRFA executive director Monte Shaw says the president directing Congress to get E15 done could be the key to finally getting it passed.

“He said he would sign it without delay. We think that was key. There are branches of government, you know the president is not Congress and Congress is not the president. But when he calls up the congressional leaders and says, ‘Hey, I want to get something done’, it’s usually gotten done and got to his desk,” Shaw says.

Legislative Path for E15

Shaw says the legislative path for E15 could be a delayed spending bill, or even a stand-alone bill, since the newly formed E15 council has been given a deadline of Feb. 15 to bring back a deal, with the hope of passage by Feb. 28.

“They did a rule that created the E15 council to keep working on it. This was before President Trump weighed in, and it gave them a date certain for a vote,” Shaw says.

Even if approved, Shaw admits the market impact won’t be felt overnight. But in five to seven years, E15 could mean another 2.4 billion bushels of corn usage annually, and the impact on corn prices could be substantial.

“Two billion bushels is not a small number, but I think people need to understand it won’t happen overnight. Even as penetration starts to grow, you start to grind a lot of corn very quickly,” he adds.

Iowa Farmers Speak To Trump

Kevin Ross, past National Corn Growers Association president, spoke directly with President Trump about E15 at the Machine Shed restaurant. He felt the president was listening.

“He’s said E15 more times in that setting than he has since probably back at the rally down at the [Southwest Iowa Renewable Energy] ethanol plant. I think he’s definitely focused on getting this across the finish line, doing what he can do and that’s really good to see,” Ross says.

He is excited about the possibility of E15 passage and what it could eventually mean for increased demand.

“I would assume the market’s going to take things positively, which we desperately need,” Ross says.

Grain Markets Rally on Money Flow: Can They Stage a Chart Breakout?

Wed, 28 Jan 2026 16:10:16 GMT

Grains started sharply higher on Wednesday with cattle and hogs mostly lower.

Soybeans Add South America Weather Premium
Soybeans were higher on Wednesday morning with double digit gains. Jamie Gieseke with Paradigm Futures says soybeans were getting a push from South American weather. Hot dry conditions have persisted in Argentina but the emerging story is FOB values in Brazil are rising as there are reports of problems moving soybeans out of the ports. The higher values are lifting U.S. prices.

Biofuels Hopes
The soybeans are also getting help from the soybean oil market which is building in optimism regarding biofuels policy according to Gieseke. The EPA has closed the comment period for the RVOs and so those blending mandates should be released late February to early March. The Office of Management and Budget has also completed its proposal on the 45Z tax credit which will now go through a 60 day comment period. However, biofuels officials say they expect those rules could be finalized by the end of March. Gieseke says this optimism has given the soybean oil market new life and it is staging a chart breakout.

Soybeans Breaking Out Technically?
Soybeans are finally above the 200-day moving average on the March contract and a close above this level could bring in some fund buying. Some of the deferred contracts are also above the $11 mark.

Corn Follows Wheat, Gets E15 Boost?
Corn futures are seeing spillover support from soybeans and more importantly wheat according to Gieseke. However, President Trump’s speech in Iowa Tuesday included comments about his support for year-round E15 and he says leaders in the Senate and House are close to getting a bill ready to be voted on. When that happens Trump said he will sign it immediately.

Corn Seeing Strong Export Demand, Is China Buying?
Corn continues to see record export demand and Gieseke says the U.S. has seen it’s share of the global corn export market expand to over 50% which goes along with the record pace being set. China has also been buying European wheat due to problems with the quality of their corn which has aflatoxins. So, could this push China into the U.S. corn market? There have been several flash sales to unknown destinations the past few weeks and he thinks its possible if China isn’t buying U.S. corn they may need to down the road.

Wheat Adds Weather Premium
Winter wheat futures were also rallying in an attempt to add weather premium. Another Arctic blast is expected to hit winter wheat growing areas further increasing concerns about winter kill in that crop. Funds are a combined short in that market (futures only) of over 126,000 contracts and so if the market continues to move through chart resistance areas it could spark a larger short covering rally. Currently, he sees $5.40 as a level that will be difficult to take out in the hard red winter wheat futures.

FOMC Monetary Policy Impacting Commodity Sector
Gieseke says the Federal Reserve announced in October they would be pausing quantitative tightening and instead would be purchasing treasuries as part of quantitative easing. He says since that time the CRB Index, which tracks commodities, has been steadily rising. He says monetary policy change has been driving money into commodities like precious metals, with traders also going short on the U.S. dollar index which has hit a four year low. This could be driving some money flow into the grain markets and if that continues it could finally help the grain markets break out of their trading ranges and start a larger rally.

Cattle Pause Ahead of Report
Cattle futures were starting out lower for a second day with the market consolidating under chart resistance hit earlier this week. The market is waiting for cash direction and the USDA Semi-Annual Cattle Inventory Report on Friday.

Biofuels Groups Urge President Trump to Expedite Biofuels Policy

Wed, 28 Jan 2026 00:58:50 GMT

Biofuels groups representing both ethanol and biomass-based diesel wrote letters to President Donald Trump — and also took out newspaper ads — ahead of his visit to Clive, Iowa. They are asking the administration to make biofuels policy a priority, expedite rules on the 45Z Clean Fuels Production tax credit and Renewable Fuels Standard Renewable Volume Obligations (RVOs) and support E15 passage that would give certainty to farmers.

Biomass-Based Diesel Production Down With Policy Uncertainty

U.S. biomass-based diesel production was down substantially in 2025, with many plants shuttered or throttling back production due to biofuels policy delays. In Iowa alone, last year’s volume was down about 30%.

That’s at the heart of the letter Clean Fuels Alliance America sent to President Trump, says Kurt Kovarik, vice president of federal affairs.

“The letter was really to tell the president: ‘Use the tools that you have available to you on the RVOs, and also on 45Z as well, to move those regulations along and provide certainty to the industry’,” Kovarik says.

CFAA Asks President Trump for Robust RVOs...Soon

While the fate of the half RIN proposal is uncertain, as part of the RVOs, Clean Fuels wants 100% of the Small Refinery Exemption (SRE) volumes reallocated and adoption of EPA’s proposed 5.61 billion gallon volumes on biomass-based diesel.

Kovarik says: “The proposal that we received from EPA back in the summer is incredibly robust and would send a great signal. So, all we’ve asked the president to do is finalize that volume obligation near what was proposed, and that would go a long way to turning plants on.”

Finalization of the 45Z Clean Fuels Tax Credit Also Needed

In addition, Kovarik says the Office of Management and Budget (OMB) indicates the proposed rules for 45Z are complete. The guidance now goes back to the Treasury, but they’ve also asked for that proposal to be expedited.

“It’s a proposal. So, this will include a notice and comment period for the public before it becomes final,” Kovarik says. “But I think just seeing the proposal for a lot of our producer-members and feed stock providers will go a long way to addressing a lot of the uncertainty that has existed with this credit.”

Kovarik thinks it’s realistic both of these biofuels policies can be completed within the next 60 days, meaning the end of February or early March.

Iowa Groups Take Out Ad Urging the President to Support E15

Farm groups including the Iowa Renewable Fuels Association and the Iowa Corn Growers Association also took out ads prior to President Trump’s visit to ask for help on year-round E15 passage.

Emily Skor, CEO of Growth Energy, says the hope is the President will turn up the heat on Congress to get the legislation over the finish line.

“We all know that what we need right now is an act of Congress,” Skor says. “And so really the conversation has to be: ‘Congress do your job. Okay? We need this.’”

This comes after Congress failed to include an amendment on nationwide year-round E15 in the government spending bills. Speaking on “AgriTalk”, Skor stated the administration and President Trump have been supportive of E15 since he campaigned for the job in Iowa.

“I think the White House wants to see Congress get something done so they can bring a bill to his desk, so he can sign it and we can be done with this once and for all,” she says.

Biofuels policy is critical for corn and soybean farmers as it adds value to homegrown corn and soybeans.

Trump Confirms Support for Year-Round E-15 Deal

Tue, 27 Jan 2026 23:17:51 GMT

President Donald Trump made a planned visit to Iowa — his first since July 2025 — on Tuesday, focusing on affordability, saying Iowa families are “winning” again under his leadership. Standing in front of a packed crowd in Clive, Iowa, with signs posted on the stage and scattered throughout the crowd that said “lower prices” and “bigger paychecks,” the visit unofficially kicked off the midterm elections where costs for consumers are expected to be one of the main political talking points.

While in Iowa, President Trump highlighted what the White House calls improving economic conditions for Iowa families, pointing to lower fuel prices, tax savings and agriculture-driven growth as signs the state is “winning again.” The President touted all the trade wins, including China buying soybeans and the EU agreeing to buy U.S. ethanol. He says by removing those trade barriers, exports are starting to flow to countries that had stopped buying U.S. ag goods before he took office.

But the reality is agriculture is at a crossroads, especially on the row crop side. Even with the recent trade deals, current economic pressures are creating a crisis in agriculture. Trump did briefly mention that crisis, blaming it on former President Joe Biden.

Trump Pushes Year-Round E15 During Iowa Visit

During his speech in Iowa, President Trump reaffirmed his campaign promise to support year-round E15, signaling a major win for corn growers and the ethanol industry.

“But I’m also working hard to expand your markets domestically,” Trump says. “In the campaign, I promised to support E15 all year round. I did. E15 all year round if I get elected, and I want to let you know, we’ll start right now.”

The statement sparked applause as Trump emphasized that efforts are underway in Congress to finalize approval, calling on House Speaker Mike Johnson and Senate Leader John Thune to deliver a deal that benefits farmers, consumers, and refiners, including small and mid-sized operations.

“I’m trusting Speaker Mike Johnson, who’s great, and Leader John Thune, who’s great, to find a deal that works. They’re very close to getting it done,” he says. “And I will sign it without delay.”

The president framed year-round E15 as a key part of his broader strategy to expand markets for U.S. corn, support rural communities, and strengthen domestic energy production.

🚨 BREAKING: President Trump announces Congress is actively working on a deal to allow E15 ALL YEAR ROUND that works for farmers, consumers, & refiners.

"Congress is working on a deal, and when they send it to my desk — I will sign it without delay."pic.twitter.com/TOpo3VUDI4
— The White House (@WhiteHouse) January 27, 2026

Trump Highlights “Historic Turnaround” for U.S. Manufacturing, Touts Deere’s Stock Hitting All-Time High

During his Iowa visit, President Trump touted what he called a historic one-year economic turnaround, pointing to manufacturing growth and new investments across the country.

“And America is respected all over the world like they’ve never been respected,” Trump says. “I thought it would take us two years. This has been the most dramatic one-year turnaround of any country in history in terms of the speed.”

Trump spotlighted John Deere as an example of American manufacturing success. He welcomed the company’s chairman at the event and praised the expansion of production facilities, including what he called two massive new plants.

“You’re opening one in North Carolina, one someplace else, and then you’re expanding all over the place. You’re doing a great job,” he says. “I bought a lot of John Deere stuff. Great country, great company, it’s an honor to have you here.”

The president attributed much of the growth to tariffs and economic policies aimed at attracting investment back to the U.S.

“It is because of tariffs and it is also because of the fact that we had such a tremendous November 5th. That November 5 brought spirit back to our country,” Trump says.

Trump then said that proof in the growth is in the stock market’s performance, including Deere stock hitting an all-time high of 529.51 on January 21, 2026.

But with strains in the farm economy, farm equipment sales saw a steep decline in 2025. Deere and Company, which has a large footprint in the Quad Cities and Des Moines, has laid off over 3,500 employees since October 2023. That downsizing, which the company says is driven by decreasing demand and lower sales, has hit the company’s manufacturing facilities hard, including locations in Waterloo and Ankeny.

John Deere Expands U.S. Manufacturing with Two New Facilities

President Trump highlighted John Deere’s plans to open two major U.S. facilities, marking a significant boost for American manufacturing and rural jobs. The president saying Deere’s decision was due to tariffs.

After the president’s remarks, the company sent out a press release, with John Deere announcing a major expansion with two new U.S. facilities coming soon to the U.S .

Dere says it will build:

A state-of-the-art distribution center near Hebron, Indiana, and a $70 million excavator factory in Kernersville, North Carolina, both set to open within the next year.
The North Carolina factory will bring excavator production back from Japan to the U.S., making John Deere the top domestic producer of excavators.

Together, Deere says the projects are expected to create hundreds of new American jobs, strengthen local economies, and advance John Deere’s commitment to $20 billion in U.S. manufacturing investments over the next decade.

John Deere executives emphasized the expansion as a continuation of their mission to “build America”, enhance innovation, and support the nation’s agriculture, construction, and manufacturing sectors.

The Strong Push for E15 to Help Turn The Ag Economy Around

As corn growers pressed for year-round E15 ahead of the president’s visit, ethanol advocates say the issue is no longer about executive action. It’s about Congress finishing the job.

Emily Skor, CEO of Growth Energy, says the Trump administration has already taken every step available to it through regulatory action.

Leading into Tuesday’s talk, biofuels leaders pushed for the president to focus on E15, saying rural America’s financial stress is colliding with a narrow policy window to get things like E15 done, and that could generate more demand, quickly changing the outlook for corn and soybean growers.

“What we hear from the team around the president is he did what he could,” Skor told Chip Flory during “AgriTalk” on Tuesday. “He issued an executive order. EPA gave us the summer waivers for last summer. We all know that what we need right now is an act of Congress.”

Skor says the White House wants lawmakers to deliver a bill that can be signed into law and end the seasonal E15 debate for good.

“The conversation has to be ‘Congress, do your job,’” she says. “The White House wants to see Congress get something done so they can bring a bill to his desk, so he can sign it and we can be done with this once and for all.”

That urgency is being echoed across agriculture, she says.

“I’ve got CEOs of all kinds of agriculture trade groups calling me saying: ‘What can we do to be helpful? We’ve got to get this done,’” Skor says. “All of agriculture is supportive of this.”

Iowa’s Reality: Corn Prices Below Cost of Production

Ahead of Trump’s second visit to Iowa in less than a year, corn growers and renewable fuels advocates used the moment to renew pressure for nationwide, year-round access to E15. Corn groups say the timing is critical, as lawmakers continue to stall on permanent E15 access despite strong Midwestern support. To make the push even more visible, Iowa Corn and the Iowa Renewable Fuels Association (IRFA) released an open letter on Tuesday , thanking the president for his past support of E15 and urging him to help push the policy across the finish line in Congress, while also running a full-page ad in Tuesday’s “Des Moines Register”.

ICGA and @iowafuel today released an open letter thanking @POTUS for his constant support of nationwide, year-round #E15 and asking for his help to finally push E15 access through Congress @realDonaldTrump pic.twitter.com/cxACXijKMN
— Iowa Corn (@iowa_corn) January 26, 2026

According to the letter, corn growers across the country, and especially in Iowa, are struggling as prices remain well below the cost of production. That pressure, they say, is rippling through the broader state economy.

The groups cite recent data from the Philadelphia Federal Reserve Bank, which ranked Iowa 50th among states for economic growth. They say expanding E15 is one of the fastest ways to reverse that trend.

“The best way to boost corn prices and create meaningful market demand is the immediate authorization of nationwide, year-round E15,” the letter states.

After Trump’s announcement on Tuesday, saying a deal is close, Iowa Corn Growers Association Vice President and farmer from Knoxville, Iowa, Steve Kuiper, expressed Iowa Corn’s appreciation, while highlighting what this could mean for farmers at a critical time.

“Iowa’s corn growers appreciate President Trump shining light on E15 and recognizing the weight this legislation holds to us as corn growers. Farmers are struggling with low commodity prices, high input costs and lack of markets. Passage of year-round E15 is the lifeline many of us need to be able to continue farming,” says Kuiper. “A recent study by Iowa Corn and the Iowa Renewable Fuels Association shared the positive effects year-round E15 would mean for corn growers. This is a goal we have been working towards for over a decade and getting this issue to the president’s desk and across the finish line is a win we all desperately need. The fact that the President sees this problem and promises a solution is coming is very encouraging and valued by us as farmers.”

Fun fact: today when @realDonaldTrump referenced supporting year-round E15 on the campaign trail, that started on January 19, 2016 at the Iowa Renewable Fuels Summit, where he was a speaker.

The next Summit is on February 5th and is FREE and open to the public. You might want to… https://t.co/g0G57UWrbF
— Iowa Renewable Fuels Association (@iowafuel) January 28, 2026

Leading up to today’s statements by Trump, both Iowa Corn and Iowa Renewable Fuels reminded the Trump administration that year-round E15 would immediately expand domestic demand for corn at a time when farmers are under intense financial pressure. Even with the latest round of financial aid through the Farmer Bridge Assistance Program payments, 92% of agricultural economists surveyed in Farm Journal’s December Ag Economists’ Monthly Monitor said the row crop side of agriculture is in a recession. More than 90% said that will accelerate consolidation in agriculture — something Iowa agriculture is seeing firsthand.

Biofuels Seen as Economic Pressure Point and Opportunity

Kurt Kovarik, vice president of federal affairs at Clean Fuels Alliance America, appeared on “AgriTalk” before Trump’s talk on Tuesday. He says the group sent a letter to the president earlier this week urging the administration to focus on two immediate policy opportunities.

“We’re excited to see him head to Iowa,” Kovarik says. “We were briefed that the purpose of the conversation was to highlight economic opportunity, perhaps domestic energy dominance.”

Kovarik says Clean Fuels asked the administration to spotlight progress on renewable fuels, particularly finalizing renewable volume obligations under the Renewable Fuel Standard and issuing long-awaited guidance on the 45Z clean fuel production tax credit.

“I’m sure you’ve had a lot of conversations around E15 — that’s in the hands of Congress,” he says. “So, what we want to do is highlight for the president the EPA’s efforts to finalize the renewable volume obligations under the RFS as an opportunity to provide market certainty and growth for our industry, as well as finalizing the 45Z clean fuel production tax credit guidance, which we do not yet have.”

That certainty, Kovarik says, has been missing, and the consequences have been felt across rural America.

“Our industry had a really, really tough 2025,” he says. “Following a really great ’24, ’25 was really poor, as it was along the farm economy.”

He says the downturn wasn’t driven by demand alone, but by uncertainty around federal policy.

“It was a lack of profit, lack of margin, which meant reduced capacity,” Kovarik says. “In fact, we’ve had a lot of plants idling.”

After producing more than 5 billion gallons of clean fuels domestically in 2024, Kovarik says output dropped sharply in 2025. Plants across the industry operated at just 60% to 70% of capacity.

“In some cases that may be a plant dialing back to 80%,” he says. “In a lot of cases, particularly the smaller plants, maybe in Iowa, those that don’t produce their own feedstock came offline entirely.”

But it’s not just corn at a crossroads. He says that slowdown directly affects farm demand, especially for soybean oil.

“If our industry got those two things in the near term, we would flip around this industry nearly immediately,” Kovarik says. “Turn these plants back on, buy more soybean oil, add value to the soybean farmer and get this fuel to the consumer.”

Kovarik points to renewable volume obligations as a key pressure point. Under the Biden administration’s final three-year RFS rule, biomass-based diesel volumes for 2025 were set at 3.35 billion gallons — well below what the industry was capable of producing.

“We produced over 5 billion gallons in 2024,” he says. “So, that’s part of the reason our industry had a tough year.”

Looking ahead, Clean Fuels, petroleum refiners and agriculture groups asked EPA to raise 2026 volumes to 5.25 billion gallons. EPA’s proposal came in even higher.

“EPA actually proposed an estimate around 5.6 billion gallons,” Kovarik says. “They were even above ours.”

If final numbers land near that range, Kovarik says it would send a powerful market signal.

“Our feeling is if it comes down anywhere in the neighborhood between what we asked and what EPA proposed, it’s going to be a very, very strong market signal,” he says.

Timing matters, too. Kovarik says EPA has indicated the rule could be finalized soon.

“Our expectation is EPA is committed to have it done within the first quarter of 2026 — that means the end of March,” he says. “Hopefully early- to mid-March.”

As corn growers push for year-round E15 and broader biofuels support during Trump’s Iowa visit, Kovarik says optimism is returning, even after a difficult year.

“Although most folks are really feeling bad about how ’25 was, they’re also very optimistic about 2026,” he says. “Because of what we feel we’re on the cusp of.”

Corn Growers Disgusted as Congress Leaves E15 Out of Government Spending Bills

Just last week, E15 and corn groups were dealt a blow. That’s because year-round E15 was left out of the latest spending package , something corn and renewable fuels groups had been pushing to get included in the latest bill.

When asked how year-round E15 failed to advance earlier this year, Skor points to political realities inside the House.

“Parochial politics,” Skor said on AgriTalk Tuesday. “It’s incredibly frustrating.”

Despite broad ag support and mounting corn supplies, Skor says narrow vote margins and competing interests stalled progress.

“We have been a chorus saying, ‘We want markets, not handouts. We want markets,’” she says. “Look at how much corn we’ve grown in the U.S. We need to find markets.”

Skor says House leadership ultimately pulled the issue from budget negotiations due to concerns over securing enough votes, particularly from members tied to small refinery interests.

“He knew that he could not get the votes he needed to pass the budget,” she says. “So he said, ‘We’re going to table this. We’re going to create a council. We’re going to deal with this separately.’ And that’s what happened.”

Looking ahead, Skor says attaching year-round E15 to a must-pass spending bill remains possible, but unlikely in the near term.

“I’m never going to say never,” she says. “But I think the realistic, immediate path for us is trusting our champions.”

She points to Rep. Randy Feenstra of Iowa as a key leader on biofuels policy.

“He’s fantastic on our issues,” Skor says. “He proved to be very, very strong in advocating for the Clean Fuel Production Tax Credit, 45Z.”

Skor says biofuels groups are now unified behind a legislative compromise that protects liquid fuels while expanding growth opportunities for American ethanol.

“We have the vast majority of liquid fuels united behind a legislative proposal,” she says. “We’ve done a really good job coming up with a compromise that has a future for liquid fuels and growth opportunities for American biofuels.”

As farmers look for demand-side solutions amid tight margins and large corn supplies, Skor says the message to Washington during Trump’s Iowa visit is straightforward: permanent E15 isn’t a wish list item. It’s a market fix agriculture needs now.

In the letter Iowa Corn and IRFA sent this week, both also pointed to Congress’ decision to sidestep E15 language in recent spending bills, instead creating a task force to study the issue. That task force, which is co-chaired by Feenstra, is scheduled to take action by February 28.

“Without permanent access to this market, the long-term viability of our state’s largest economic driver is at serious risk,” the groups wrote. “Today, we are asking for your help to finally push E15 access through Congress.”

It’s that same sentiment that was relayed in a statement from National Corn Growers Association (NCGA) president Jed Bower last week, who said corn growers “were disgusted, disappointed and disillusioned” after spending years of calling on Congress to pass E15.

“I met with Speaker Johnson back in November. He said he was frustrated because DOGE had pulled this out last year. He said he would get something done, and here we are again,” said the Ohio farmer. “The same thing we get all the time. Let’s step on and push on the farmers because there’s not very many of them and we can get away with it.”

Small Refiners Still a Roadblock to Year-Round E15

Even with support from major oil groups, Skor says a small group of refiners continues to wield outsized influence in Washington — enough to stall year-round E15 despite broad backing from agriculture and much of the energy sector.

“Well, enough that they could hamstring the speaker and they could hold up the votes on the budget,” Skor says, responding to questions about whether small refiners still carry weight in Congress.

Skor says the current proposal on the table represents a significant compromise, one she believes should be moving now.

“Let’s get year-round E15. Let’s reform the small refinery program so fewer refiners get it and we have more clarity,” she says. “We are supportive of that.”

She argues the small refinery exemption program has been abused, pointing to a growing number of legal challenges.

“There are over 15 lawsuits that have been filed in 2025 because of these small refiners. They’re greedy,” Skor says. “They’re whiny. They claim and allege hardship, and then they get on investor calls and talk about all the money they made in the quarter. You can’t have it both ways.”

Skor says the ethanol industry and its allies are now focused on exposing what she calls that hypocrisy while maintaining pressure on lawmakers.

“We have a very strong coalition now that should win the day,” she says.

Corn Growers Argue E15 Is a ‘No-Cost’ Solution

Iowa Corn and IRFA frame E15 as both an economic and regulatory fix, calling the current restrictions outdated and unnecessary.

“Removing the outdated regulatory hurdle for E15 is exactly the type of government efficiency you’ve worked for,” the groups wrote, urging Trump to continue applying pressure as Congress debates the issue over the coming weeks.

They also emphasize permanent E15 access would come at no cost to taxpayers, while strengthening American energy dominance and providing a critical lifeline to corn producers.

“Permanent nationwide access to E15 is a common-sense, no-cost solution,” the letter sent earlier this week concludes. “Now is the time.”

With the task force deadline looming and the president back in Iowa, corn growers hope the renewed push will translate into action and finally deliver year-round E15 access they’ve been seeking for more than a decade.

Trump Defends Tariffs, Says Farmers Will Be “Biggest Beneficiary”

Ahead of his Iowa talk, President Trump made an appearance at the Machine Shed restaurant in Urbandale, where he had an exclusive interview with Fox News. During that interview, Trump strongly defended his use of tariffs, calling them “indispensable” to economic growth and long-term benefits for farmers.

“Tariffs have been indispensable toward success,” Trump says. “We’ve taken in $600 billion in tariffs.”

Trump says some of that revenue has already been directed back to agriculture, including the Farmer Bridge program payments, which are scheduled to be in farmers’ bank accounts by the end of February.

“I gave the farmers $12 billion last week and took them out of tariff money,” he says.

When asked about concerns from Iowa farmers who worry tariffs could hurt exports and commodity prices, Trump says the benefits will take time to materialize.

“It’s going to take a little while to kick in,” he says. “But I think the farmers are going to be the biggest beneficiary.”

Trump points to protections against foreign crops being sold into the U.S. at below-market prices.

“When you used to have people coming in and dumping their crops into the United States, you guys were hurt,” he says. “They’re not allowed to do that because we’re tariffing those crops.”

He also draws parallels to his first-term trade battles, particularly with China.

“The farmers stuck with me the first time, and I was right,” Trump says. “We gave them $28 billion then. Now we gave them $12 billion, sort of a minimal payment.”

While acknowledging legal challenges could arise as the Trump administration awaits the Supreme Court’s ruling, Trump still signaled tariffs, or similar tools, will remain part of his strategy.

“If the Supreme Court strikes down the tariffs, we will find something — some other way of doing a similar thing,” he says. “But it’ll be more inconvenient.”

As Trump delivers his message in Iowa, tariffs remain a flashpoint for rural America, balancing promises of long-term protection with near-term uncertainty for farmers navigating tight margins and volatile markets.

Soybeans Bounce on Biofuels Hopes: Corn and Cattle Consolidate

Tue, 27 Jan 2026 21:32:07 GMT

Soybeans and bean oil bounced on Tuesday with corn lower and wheat ending mixed. Cattle were mostly lower as well as milk futures.

Soybeans and Bean Oil Bounce on Biofuels Hopes
Soybeans and soybean oil saw a higher day on Tuesday driven by hopes President Trump would make a biofuels policy announcement regarding 45Z or the RVO proposal while speaking in Iowa after the market close. Naomi Blohm with Total Farm Marketing says the market is looking for another demand story with exports running behind a year ago and China completing their 12 MMT soybean purchase agreement.

China Done Buying U.S. Soybeans?
Blohm says China may be done buying U.S. soybeans until at least August as that is their normal seasonal pattern. Currently they have switched over buying cheaper Brazil soybeans as the new harvest is coming to market. News reports quoted private China buyers that stated China had bought 25 cargoes of Brazil beans for March and April delivery. When China comes back to the U.S. for soybeans it is unclear if they will be working on the 25 MMT purchase commitments or not. Currently, Blohm is skeptical about China’s willingness to buy 25 MMT in the next year.

South American Crop Estimates Being Watched
Hot dry conditions in parts of Argentina have been watched by the markets and at least some private estimates are starting to recognize some yield loss as a result. Dr. Michael Cordonnier lowered his Argentina corn and soybean estimates by 2 MMT. Meanwhile, he and other private firms continue to inch up the Brazilian crop and he raised his production estimate 1 MMT to 179 MMT while AgRural’s latest forecast is at 181 MMT. So Blohm says there will need to be more sustained weather stress and production loss to really lower the crop size and get the markets attention.

Soybeans Still in a Trading Range
The technical picture for soybeans continues to show the market struggling to get through the 200-day moving average resistance area on the charts basis March and Blohm says she doesn’t see too much that can change that in the near term.

Corn Drifts Despite Strong Export Demand
Corn futures drifted on Tuesday unable to follow the strength in the soybean market. Blohm says it was also disappointing that a flash sale of 4.33 million bu. of corn sold to unknown destinations was unable to support the corn market. There was also a sale of 12 million bu. sale of sorghum to unknown destinations, one of the largest single buys in nearly a decade. Could this be China? She says it is very likely China is behind the sorghum purchase but she thinks they could even be buying corn.

Corn Sees Range Bound Trade
Corn has also been trading in a new lower price range since the January WASDE report. Blohm says the market is stuck between strong support at $4.10 and resistance in the $4.30 to $4.35 area. She says corn may be unable to break above that level without a problem with the second crop corn in Brazil but that is going to be a couple of months down the road. The bottom side of the trading range should be well supported by strong end user demand, especially exports.

Wheat Also Stuck
Wheat futures traded both sides of steady Tuesday but continue to consolidate under last week’s highs. The market saw some short covering with concerns about winter kill but that fear has eroded and so will the market prices according to Blohm. She says demand has been strong on the export front but not strong enough to chew through burdensome global supplies.

Cattle Consolidate Ahead of Report, Cash
Cattle futures consolidated under Monday’s highs which served as technical resistance on the charts. The market may trade sideways awaiting higher cash trade again this week and ahead of the USDA Semi-Annual Cattle Inventory Report. The bulls will be looking for confirmation of the tight supplies but also news of any herd rebuilding on the horizon.

Milk Futures Pause After Limit Up Move
Class 3 milk futures were slightly lower on Tuesday, consolidating after some limit up moves on Monday. Blohm says the market rallied with some better prices for cash butter and cheese. She says futures have also priced in USDA’s production increases that have weighed on the market the last few reports. However, the upside is limited from here in the market.

Corn Growers Disgusted as Congress Leaves E15 Out of Government Spending Bills

Fri, 23 Jan 2026 03:55:12 GMT

Corn farmers were kicked out of the U.S. Capitol on Wednesday after protesting against Congress for their failure to include E15 legislation in the government spending bills at the last minute.

Congress Omits E15 Deal From Government Spending Bills

After reaching a compromise deal on E15 between the petroleum industry and biofuels groups, the coalition has been working for the last few months to build support in Congress to include an amendment on year-round E15 in the appropriations bills to continue funding the government after Jan. 30.

Geoff Cooper, president and CEO of the Renewable Fuels Association says they were surprised when the Senate version did not contain that language and instead kicked it over to the House. “Congressman Zach Nun from Iowa offered an amendment that would include the E15 language. We were very much in play the last few days trying to get that language into this package, but as of today, it appears that what is going to happen is Congress is going to kick the can again on getting this legislation done.”

E15 sales are currently limited in the summer months due to air quality regulations under the Clean Air Act.

Corn Growers Disgusted

In a statement National Corn Growers Association president Jed Bower said corn grower were disgusted, disappointed and disillusioned after spending years of calling on Congress to pass E15. “I met with Speaker Johnson back in November. He said he was frustrated because DOGE had pulled this out last year. He said he would get something done and here we are again. The same thing we get all the time. Let’s step on and push on the farmers because there’s not very many of them and we can get away with it.”

Rural Domestic Energy Council Formed

Instead, to make all parties happy the White House has created a new Rural Domestic Energy Council.

Cooper says the group consists of oil refiners, E15 supporters and lawmakers, who are tasked to develop potential legislative proposals on E15, for future adoption. “It appears there is an agreement in the works that would create a new council that would be comprised of members of Congress who are going to further study and further debate E15 and the RFS and small refinery exemption issues over the next month or so with the idea that they would have a comprehensive legislative proposal to bring back for consideration near the end of February.”

Bower says this essentially means having to start over on their E15 efforts. The push back is coming from the Freedom Caucus. “Well, the Freedom Caucus is all worried about government spending, government overreach, and literally the government scored our bill to save the government $6 billion. Let alone what it does for agriculture in the horrible time we’re having and it’s going to drop fuel prices 25 cents a gallon. What the hell does the Freedom Caucus really believe in?”

Bower calls this a cowardly move by the administration and says it comes after a compromise deal was already struck between the ethanol and petroleum industries. “When we met at the White House and fought through this with the American Petroleum Institute, we had a lot of oil and gas support for this.” He called it a cowardly move by the administration.”

What’s the Legislative Pathway for E15 Now?

Without attaching E15 to the spending bill, it must pass as stand-alone legislation and that will be a heavy lift in Cooper’s estimation. “We know this is an election year. We know there are going to be very few opportunities between now and the election to move legislative vehicles.”

So Cooper says the call to action for farmers is to pressure Congress. “We have a broad coalition of support behind a carefully crafted deal. Congress should not let that slip away and and they should do everything they can to wedge that into this appropriations process here at the end of January.”

Because he says immediately opening new markets is the fastest way out of the crisis facing the nation’s farmers and they can’t afford to wait.

Economists Forecast Farm Economy to Stabilize, But High Costs and Policy Uncertainty Block a 2026 Rebound

Wed, 07 Jan 2026 18:26:37 GMT

As 2026 ushers in a fresh start, agricultural economists say the U.S. farm economy has stopped sliding, but it’s far from fully healed.

The December Ag Economists’ Monthly Monitor shows month-to-month sentiment is improving, but deep structural strain remains — especially in row crops. Meanwhile, livestock markets continue to provide strength. Crop producers face another year of tight margins driven by high input costs, weak prices and unresolved trade and policy uncertainty.

“There’s cautious optimism,” the economists say, “but very little belief that 2026 will bring a meaningful rebound without cost relief or stronger demand.”

Those themes mirror the perspective of Seth Meyer, former USDA chief economist and now director of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri. In a recent interview, Meyer connected the dots between narrow margins, policy responses and what might actually move the dial for U.S. agriculture heading into 2026.

Stabilizing, Not Recovering

December Ag Economists’ Monthly Monitor

(Lori Hayes )

Economists see the ag economy holding its ground — but not gaining strength.

54% say the ag economy is somewhat better than one month ago.
Compared with a year ago:
- 42% say conditions are worse
- 33% say they are better
Looking ahead 12 months:
- 46% expect conditions unchanged
- 38% expect improvement
- 15% expect conditions to worsen

“Momentum has improved since mid-2025,” Meyer notes, “but tight margins have been with us for a long time. Turning that around requires demand growth, not just price stabilization.

Farm Journal’s December Ag Economists’ Monthly Monitor

(Lori Hayes )

Grant Gardner, assistant Extension professor at the University of Kentucky, tells AgriTalk’s Chip Flory: “I think as we move into kind of this next marketing year, you’re looking at what looks like a breakeven and not a loss, but breakeven still doesn’t look great after three years of breakeven or losses.”

He says even with the $11 billion in Farmer Bridge Program payments , it won’t drastically change the outlook for the farm economy.

“Purdue had a good survey about a month ago, where they looked at what were these payments going to go to, and research would show that a lot of these payments go into long-term assets, and so land tractors, but I think over 60% of producers right now are in such a tight cash crunch that you’re going to see a lot of these payments go into that short-term debt,” Gardner says.

Consolidation a Growing Threat

Economists are nearly unanimous that the crop sector remains under extreme financial stress. 83 percent say row crops are currently in a recession. That isn’t about production declines — acres and yields haven’t collapsed — but about persistently weak profitability.

“Negative returns for at least the third consecutive year across nearly all row crops,” one economist wrote in the survey.

Another said: “Margins remain below full costs of production for many producers.”

Farm Journal’s December Ag Economists’ Monthly Monitor

(Lori Hayes)

Meyer traces that back to how abruptly agriculture moved from the high prices of 2021 and 2022 into today’s tighter margins.

“We moved very quickly from a very high price environment and good profitability in 2022 to very tight margins,” he says. “That usually happens coming off price peaks, but this time it happened really rapidly.”

A minority of survey respondents argued farms are “treading water,” supported by strong land values and government aid rather than eroding further, which Meyer acknowledged aligns with how risk and safety nets have interacted this year.

But when you look at how the current stress in the farm economy could impact consolidation, the ag economists say it’s the economic pressure combined with demographic trends causing the acceleration. In fact, 92% of them say consolidation is underway and unavoidable.

“Markets go to the lowest-cost producers,” one economist wrote. “That sorting is consolidation on the production side.”

Aging producers exiting and rent-heavy operations under pressure only add fuel to that trend, with one economist saying: “Consolidation happens because producers have to exit, not because they want to.

What’s Driving the Farm Economy Right Now

When economists were asked to identify the two most important factors shaping agriculture’s economic health today, their responses clustered around a familiar, but increasingly sharp, divide: strong demand in livestock and the protein sector versus persistent oversupply and cost pressure in crops, all layered with trade and policy uncertainty.

Several economists pointed to continued strength in beef demand, both domestically and through export channels, as a key stabilizing force. While the dairy sector is an area that shows signs of weakness for 2026.

“Livestock revenues are a bright spot,” one respondent noted, underscoring why the livestock sector continues to outperform crops financially.

Looking to 2026, economists overwhelmingly point to input costs, not interest rates, as the biggest barrier to profitability. Nearly 70% cited input prices as the largest challenge as well, far ahead of trade concerns or capital availability.

Farm Journal’s December Ag Economists’ Monthly Monitor

(Lori Hayes )

“We have too much supply and not enough demand for row crops,” one economist wrote.

Another said: “Input costs are still too high.”

Trade remains a central wild card, especially relationships with China and uncertainty around global supply. Several respondents cited trade disputes and agreements as critical factors, along with questions about the size of South American crops and how that could shape global competition in the months ahead.

Policy uncertainty was also featured prominently, with economists pointing to domestic biofuels policy, government payments and broader market signals as factors influencing both short-term cash flow and longer-term demand growth.

Overall, economists say the ag economy is being pulled in opposite directions: strong livestock demand providing support, while crops struggle under high costs, oversupply and unresolved trade and policy questions — a dynamic that helps explain why the broader farm economy feels stable, but far from healthy, as 2026 approaches.

Livestock: A Continued Bright Spot

Livestock continues to stand out as the most financially healthy segment of the ag economy. Every economist surveyed rated beef as above average or excellent, supported by strong domestic demand and tight supplies. Dairy and pork were viewed as stable to moderately strong.

That success creates a stark contrast with row crops, where corn and cotton were cited by 38% each as the commodities most at risk financially in 2026.

What Could Move Crop Prices in the Next Six Months

Looking ahead to the first half of 2026, economists say crop prices will hinge less on domestic fundamentals and more on global supply, trade flows and policy clarity.

Across responses, South America emerged as the dominant influence, with economists repeatedly citing Brazilian weather, the size of the South American harvest and how those supplies compete with U.S. exports. Several noted that clarity around South American production will be critical in setting price direction for corn, soybeans and wheat.

Trade, particularly with China, remains another key swing factor. Economists emphasized not just the announcement of trade agreements, but whether purchases translate into actual shipments.

“China purchases of U.S. crops, but also if and when actual shipments occur,” one respondent noted, adding that details within any trade deal, including purchase commitments, will matter just as much as headlines.

Domestic factors still play a role, but economists see them as secondary in the near term. Input prices, early U.S. planting conditions and assumptions about 2026 acreage were all cited as important — especially as markets begin to trade expectations for next year’s crop mix.

Policy uncertainty also hangs over the outlook. Economists pointed to ongoing questions around trade policy, biofuels policy and broader economic conditions as variables that could amplify or mute price moves.

Economists say crop prices over the next six months are likely to be driven by how global supply unfolds, whether export demand materializes and how quickly policy uncertainty is resolved, rather than by any single domestic production shock.

Biofuels Policy: A Potential Turning Point?

One of the clearest themes Meyer highlights as a possible game changer for demand, and ultimately prices, is biofuels policy.

For economists, policy levers like year-round E15, Renewable Fuel Standard (RFS) volumes, 45Z investment tax credits and how small refinery exemptions are handled could meaningfully influence demand for corn and soybeans in 2026 and beyond.

“It’s one of the places where policymakers actually have levers to help with tight margins in the row crop sector,” Meyer says.

He emphasizes that final rules on RFS volumes and how biobased credits are implemented could impact feedstock demand.

“For the next couple of crop seasons, RVO (Renewable Volume Obligations) and how EPA reallocates small refinery exemptions are big factors,” Meyer says. “Should we raise the RVO to soak up that pool like a sponge? Should imported feedstocks get full 45Z credit? Those decisions could move demand.”

On year-round E15, a long-sought policy priority for corn growers, Meyer is cautiously optimistic.

“I do think it matters,” he says. “Maybe it’s not a huge swing this year, but offering certainty and building demand over multiple seasons is supportive. Other countries like Brazil are ramping up their biofuels production too, so this isn’t happening in a vacuum.”

Policy Uncertainty Still Looms

Economists also flagged top priorities for 2026 policy action:

Year-round E15 (row crops)
Trade policy clarity (row crops & livestock)
Labor reform and regulatory issues (livestock)

They also highlighted under-covered risks, which include pressure on land rents and values, labor shortages, biofuels policy details (such as 45Z credits) and slower population growth affecting long-term demand.

What Could Move Livestock and Dairy Prices in the Next Six Months

When economists look ahead to livestock and dairy markets in early 2026, they see a mix of strong demand signals, supply-side risks and policy uncertainty shaping price direction.

Consumer demand remains the cornerstone of the outlook, particularly for beef. Several economists pointed to continued buying interest from U.S. consumers as the primary support for cattle prices, even as affordability pressures rise. At the same time, some warned that a more “K-shaped” economy could begin to shift demand, pulling some consumers away from beef and toward pork.

Supply dynamics and herd trends are another major focus. Economists cited herd size, potential herd expansion and the availability of feeder cattle as critical variables. The expected resumption of feeder cattle imports from Mexico was highlighted as a key factor that could influence cattle supplies and pricing, depending on timing and volume.

Animal health risks also remain on the radar. Issues such as avian influenza, screwworm and other disease threats were mentioned as potential disruptors that could quickly alter supply conditions in both livestock and dairy markets.

Policy and trade uncertainty continues to hover over the sector. Economists pointed to ongoing questions around tariffs, restrictions on live animal trade with Mexico and the next steps under the USMCA as factors that could impact both imports and exports. Political uncertainty more broadly was also cited as a potential source of market volatility.

For dairy, economists noted that beef-on-dairy dynamics are likely to continue weighing on milk prices by increasing beef supplies while complicating dairy herd decisions.

Taken together, economists say livestock and dairy prices over the next six months will be driven by a delicate balance between strong consumer demand, evolving supply conditions and unresolved trade and policy questions, with any shift in one of those areas capable of moving markets quickly.

Acreage Expectations: Stress, Not Shock

Despite margin pressure, economists do not expect dramatic acreage pullbacks in 2026. Most expect:

Corn: 93 to 95 million acres
Soybeans: 84 to 86 million acres
Wheat: 44 to 45 million acres
Cotton: 9 to 10 million acres

Corn acreage expectations have edged lower since November, as economists backed away from another year above 95 million acres. At the same time, soybean acreage expectations have firmed, with 75% now targeting 84 to 86 million acres, suggesting stronger relative economics for beans.

“Export demand has helped keep corn acres supported,” Meyer says. “The question is whether that demand holds and whether policy supports it.”

As for acreage, the major impact on prices would be a large acreage reduction, which is unlikely.

“That’s what it comes down to, too. What I’ve been thinking about is what else can you use land for? And you’ve got the pushback on urban sprawl, you’ve got pushback on other uses for ag land. But right now, the simple fact is we’ve got way too much production. Without that slowing, or a drastic increase in demand, I don’t see prices improving to very lucrative levels,” Gardner says.

Overall, The Ag Economy Is a Grind, Not a Rebound

When you look at all the results from the December Ag Economists’ Monthly Monitor, economists paint a picture of an industry that has stopped getting worse, but has not yet found a path to durable profitability.

Crops remain mired in margin compression; livestock continues to outperform but remains sensitive to policy decisions. Government aid is buying time but not addressing structural challenges, but it’s policy outcomes, especially around biofuels, trade and E15, that could be decisive in shaping 2026 outcomes.

For now, the farm economy has found a floor. The tougher question, economists say, is whether policy can help lift it, or if it will continue to grind forward without a genuine rebound.

Related News: As Screwworm Inches Closer, When Could the U.S. Reopen the Southern Border to Cattle Imports?

Hope on the Horizon: Farmers Anticipate 'Bridge Payment' Announcement

Tue, 02 Dec 2025 21:27:48 GMT

Agriculture Secretary Brooke Rollins said on Tuesday that the Trump administration will announce a “bridge payment” for farmers next week that will provide short-term relief while longer trade and aid packages are finalized. The dollar amount has not been disclosed, though some groups have estimated the total amount will be in the neighborhood of $12 billion.

While many growers acknowledge the necessity of such ad-hoc payments amid mounting financial challenges, other farmers question whether the stopgap measures offer real solutions. Northeast Iowa farmer Tim Burrack says he is in both camps regarding the payments.

“Yeah, there’s people that can really use them. Everyone can use them,” says Burrack. “Our cost structure is terrible – our costs versus our returns. But in the big picture, I think these ad-hoc payments just kind of pacify us. We’re not getting real solutions.”

Farmers Want Market Opportunities
Burrack ticks off a short list of actions he believes the Trump administration needs to take that can help corn and soybean farmers. Chief among them, more export market opportunities and reduced trade barriers.

“We’re not getting our biofuel solutions,” Burrack adds. “We’re not getting E15, and now it looks like we still may allow imported feedstocks from China.”

Despite time to do so, Congress has not voted on legislation that would allow consumers across the country to access E15 year-round, according to Jed Bower, Ohio farmer and National Corn Growers Association president.

Northeast Kansas farmer Ken McCauley shares Bower’s sentiment. “President Trump has to come through on this. E15 is a no-lose deal,” says McCauley.

Like Burrack, McCauley favors the use of ad hoc payments to farmers in the short-term. “These payments do help, but I think they give a poor signal to input suppliers that we can keep this up, that everything’s going to work out. But it might not work out,” he says. “We’re talking some high numbers [of farmers at risk]. It’s not like the ‘80s, but it could get there pretty quick.”

Burrack says he is more concerned about the long-term future for American farmers and consumers, as well.

“My bigger concern is the federal government and the debt,” he says. “The issue is the American people are not prepared for the pain that’s coming because of the deficits. Either we’re going to be paying a lot more taxes, or people are going to have a lot less services, and no one wants to do either one. I don’t know how that’s going to turn out, but that’s the big concern I have.”

For more insights from Burrack and McCauley, listen to their discussion on AgriTalk with Host Chip Flory:

Is EPA Reversing Course on RFS Proposal? Agency Pushes Back on Rumors as Ag Sector Awaits Final Rule

Fri, 21 Nov 2025 20:07:50 GMT

The EPA says it is “working expeditiously” to finalize Renewable Fuel Standard (RFS) volumes after proposing record-high blending requirements for biomass-based diesel earlier this year — levels that could deliver a major boost in domestic soybean demand. But with rumors swirling about potential delays or softened requirements, agriculture stakeholders are asking: Is EPA reversing course?

In an exclusive interview with U.S. Farm Report, EPA deputy administrator David Fotouhi says the agency is committed to getting the RFS rule “exactly right,” and strongly disputes reports suggesting the administration may scale back or delay the proposed increases.

EPA Still Won’t Commit to a Date, But Says Final RFS Rule Is “On Track”

While agriculture groups continue pressing for clarity on when EPA will finalize its Renewable Fuel Standard volumes orignally proposed in June , the agency maintains that the process remains on schedule — though it’s still without a specific public release date.

The deputy administrator emphasizes the RFS rulemaking has been a top priority since the new EPA leadership took office in January.

“We understand how important it is to get this exactly right,” he says. “From day one, administrator Zeldon has been laser focused on ensuring that the RFS strikes the right balance and carries out our statutory obligation to set volumes, considering the factors that are in the Clean Air Act.”

He notes the original proposal, which was unveiled in January, and the June update were shaped under difficult circumstances.

“When we came to the agency here in January, we had an unprecedented backlog of small refinery exemptions that the Biden administration had failed to consider,” he explains. “We also had a Renewable Fuel Standard program that was behind on setting volumes.”

To address that, EPA not only advanced its main proposal but also issued a supplemental notice proposing how to reallocate volumes connected to those outstanding small refinery exemption decisions.

“We’ve invested a lot of time and effort in the proposal that you just described, as well as the supplemental notice on reallocation of those SRE-exempted volumes,” he says. “That comment period just recently closed, and we’re looking at all the comments we received on the initial proposal from the summer, as well as on the supplemental notice that we just issued.”

(EPA)

The comments are now being reviewed collectively as EPA weighs what the final RVOs should look like.

“We’re taking all of that on board and considering that when deciding how to set the final RVOs,” he continues. “And we are working expeditiously to do that because we know farmers across the country and all the other stakeholders implicated by this program need certainty.”

Pressed on whether the final rule could realistically land this winter or slip into spring, he again declined to give a specific timeframe but reiterated the agency’s urgency.

“What I can say is that we’re working expeditiously to provide that level of certainty,” he says. “We know that we need to set these volumes so that stakeholders can adjust and act accordingly and start meeting the standards. We are working as quickly as we can to take final action on that proposal.”

EPA Slams Reuters Report on Imported Biofuel Incentives

EPA’s frustration with outside reporting was on full display when asked about a Reuters article suggesting the administration is considering delaying proposed cuts to incentives for imported biofuels — a key piece of EPA’s June proposal that was intended to prioritize domestic production. Reuters reported refiners had pushed the administration to dial back or postpone the shift, prompting widespread speculation that EPA might be reversing course.

The deputy administrator forcefully rejects that narrative.

“What I can say now is that there are a lot of rumors and speculation about what we might or might not do,” he says. “We can’t prejudge the outcome of where we’re going. We’re still looking at all of the public comments.”

He made it clear the agency views the Reuters report as misleading and potentially harmful to agricultural markets.

“It’s very frustrating, frankly, when a news agency like Reuters comes out and spreads rumors and innuendo about where we may or may not be going,” he says. “They do it in a way that actually moves markets and causes commodity prices to be affected before we’ve even made a decision.”

The deputy administrator stressed the imported biofuel incentive changes laid out in June remain on the table — and nothing has been rolled back behind the scenes.

“As you said, it was an integral part of our proposal,” he notes. “We’ve received a lot of public feedback on it that we are reviewing from stakeholders across the board, and we’ve made no final decisions yet on that issue.”

He went even further, directly questioning the appropriateness of the Reuters reporting.

“It is irresponsible for Reuters to be speculating about that at this time,” he says. “We are taking this seriously, we are reviewing the comments, and we will make a decision based on the law and the record — not based on rumor.”

The agency’s direct pushback underscores the sensitivity surrounding EPA’s final RVO decision. Every signal about imported biofuels, biomass-based diesel volumes or domestic versus foreign supply carries major implications for commodity markets, soybean crush demand and the renewable fuel industry.

EPA’s message to farmers: Ignore the rumors, wait for the rule and understand that:

No decisions have been finalized
Public comments are still being reviewed
Reports of policy shifts are premature
Certainty for farmers is a guiding priority

More Background on the RFS Proposal

As Farm Journal originally reported in June , EPA’s proposed rule is a potential game changer for farmers. The proposal would increase biomass-based diesel requirements, from 3.35 billion gallons in 2025 to 5.61 billion gallons in 2026, supporting American row-crop growers in the process.

The proposal includes at least three key regulatory shifts that would accompany the volume increases:

Heightened quotas for cellulosic biofuel, biomass-based diesel (BBD) and advanced biofuels.
Prioritization of soybean oil and ethanol produced in the U.S. Imported biofuels would earn just 50% of the Renewable Identification Number (RIN) value compared to U.S.-based fuels.
Removal of renewable electricity (eRINs) as a qualifying fuel, reinforcing liquid biofuels as the RFS centerpiece.

EPA Signals a Broader Deregulatory Strategy

Beyond the RFS, the agency is emphasizing cost-cutting and regulatory relief as core priorities — offering a stark contrast to Biden-era policy approaches.

In August, EPA finalized its decision not to impose new wastewater discharge rules on meat and poultry processors, reversing a previous proposal the deputy administrator says would have cost facilities “millions, if not tens of millions of dollars” with limited environmental benefit.

He argues the change is part of a coordinated administration-wide effort to reduce the cost of living, noting that avoiding new regulatory burdens could help keep grocery prices lower.

Earlier this year, EPA also announced what it called the largest deregulatory action in agency history, spanning 31 changes intended to reduce energy and regulatory costs for farmers, ranchers, and manufacturers.

“One of our biggest focuses is reducing the cost of energy,” he says. “We’re working across agencies — USDA, DOE, Interior — to identify ways to lower input costs for producers. That’s a priority for the president.”

Indonesia Rolling Out “B50” Biofuel Program

Thu, 13 Nov 2025 12:43:28 GMT

Indonesia will start road safety tests for its planned B50 biofuel program early next month, according to a Bloomberg report. However, there are concerns over tighter palm oil supplies. “The world’s biggest producer of palm oil is planning to expand its biodiesel mandate from 40% to 50% by the second half of next year to slash a hefty fuel import bill and greenhouse gas emissions. The palm industry is closely watching Indonesia’s timing of the rollout, as the program is expected to soak up supplies available for export and lead to a global palm oil squeeze and higher prices,” said Bloomberg. The Indonesian government is considering partial B50 implementation, only for the public sector, due to potential supply issues. The ideal blend for non-public sector use will be studied in the meantime. To ensure steady supplies, Indonesia would need to expand its palm plantations, said Baginda Siagian, a palm oil official at the agriculture ministry. The country currently has a moratorium in place for opening up forests for new plantations — a move that was essential to slowing rampant deforestation and welcomed by environmentalists. “Agriculture ministry plans for expanding new palm oil plantations by 600,000 hectares, including 400,000 hectares for smallholders and the rest for state-owned companies, to fulfill rising domestic demand,” he said on the sidelines of the conference, without elaborating further, said Bloomberg.

Unlock more market analysis and insights from Pro Farmer - subscribe for 50% off.

Biofuels Capacity Growth Slowed Last Year

Tue, 28 Oct 2025 21:54:33 GMT

Capacity growth for U.S. biofuel production slowed in 2024, the Energy Information Administration said in a report this week. It found that production capacity rose by a modest 3% from the start of 2024 to the start of 2025, based on the agency’s latest biofuels production capacity reports.

Most of the slowdown was due to a deceleration in production capacity in renewable diesel and other biofuels. Sustainable aviation fuel (SAF), renewable naphtha, and renewable propane make virtually all other biofuels, the EIA said.

Production capacity for renewable diesel and other biofuels increased just 391 million gallons a year in 2024, less than a third of the growth seen in 2022 and 2023, the report said. Only two capacity additions came online in 2024, both in California: Phillips 66’s conversion of its Rodeo refinery to exclusively produce biofuels and a new Renewable Fuels LLC plant in Bakersfield. The conversion gave the Rodeo plant a capacity of 767 million gallons a year, up from 180 million the previous year, and makes it the second-largest renewable diesel plant in the U.S. after Diamond Green Diesel’s 982 million gallon-a-year plant in Norco, Louisiana.

Growth from the Rodeo expansion and the 138 million gallon-a-year Bakersfield plant was partially offset by the loss of capacity at four facilities, the EIA noted: Monroe Energy and Chevron stopped co-processing renewable diesel at their Trainer, Pennsylvania, and El Segundo, California, refineries, respectively; Vertex Energy closed its Mobile, Alabama, plant and Jaxon Energy closed its Jackson, Mississippi facility. Sign up for more from Pro Farmer.

Breeding for New Markets: How University of Minnesota is Working to Boost the Oil Content in Soybeans

Thu, 23 Oct 2025 13:37:12 GMT

At the University of Minnesota, soybean breeders are looking far beyond the next harvest; they’re developing varieties that can withstand pests, push yields higher and meet new demands from renewable fuels. That also means breeding soybeans to contain higher oil content that traditional varieties today, an innovation that could cater to the possible new demand.

Aaron Lorenz, a professor of agronomy and plant genetics, has spent the past decade leading efforts to ensure farmers have tools that work today and decades down the road. Standing in a research plot near St. Paul, he gestures toward rows of soybeans that tell the story of decades of progress.

“In the front we have varieties released in the 1940s and 1950s,” Lorenz explains. “You can see that they’re falling down. They don’t have very many pods on them. They’re very tall and lanky — not very good agronomically.”

Those early varieties might have been cutting-edge at the time, but they pale in comparison to today’s resilient, high-yielding soybeans.

“On average, breeders have increased yield by about a half a bushel per year,” Lorenz says. “Right now, the varieties farmers are growing yield about two and a half times more than what their predecessors grew back in the 1940s and 1950s. On-farm yield has increased two-and-a-half to three times — and a big chunk of that has been due to breeding better varieties. It’s been a long, continual investment. Incremental, but over time it adds up to something much better.”

Battling a Hidden Threat: Soybean Cyst Nematode

Yield isn’t the only focus. Lorenz and his team are also taking on one of the most persistent, and invisible, enemies of soybean farmers: the soybean cyst nematode (SCN).

“Soybean cyst nematode is No. 1,” Lorenz says. “The main concern is that the current resistance most Minnesota farmers use comes from one single source that researchers discovered 40 or 50 years ago. It’s been used so long and so often that there’s now resistance breakdown occurring on the landscape. The nematodes are evolving to overcome our current source of resistance.”

That means farmers who believe they’re protected might not actually be, and once they discover thee issue, it’s often too late.

“A farmer may plant a resistant variety, thinking they have protection,” Lorenz explains, “but if the nematode population in their field has changed and overcome that resistance, they may be losing yield and not even know it. That’s why it’s good to get a soil test and rotate your sources of resistance.”

Lorenz says his breeding program is working to stay ahead of that curve, developing new varieties before the old ones lose their power.

“We’re working with projects with Minnesota Soybean and the United Soybean Board,” he says. “We’re not just discovering new sources of resistance; we’re breeding with different ones. We know which genes have good resistance for new SCN populations, and we’re getting those into elite varieties that farmers may want to grow.”

Some of those experimental lines are already showing promise.

“We’ve had some varieties that have done quite well,” Lorenz says. “They’re not quite ready for farmers to use right now, but we’re hopeful. Getting them into better varieties will eventually give us strong performers in the future.”

Breeding for New Markets: Renewable Diesel and High-Oil Soybeans

Beyond yield and pest resistance, Lorenz’s team is also thinking about how soybeans will fit into the future of energy. With renewable diesel demand growing, farmers are being asked to produce crops with higher oil content.

“We understand there’s a lot of potential future demand for renewable diesel, which is going to require a lot more oil,” Lorenz says. “We’d like to increase the oil content in soybeans, from around 22% to maybe closer to 30%, to make it a higher-oil crop and more valuable from that standpoint.”

That work started when the Minnesota Soybean Growers Association approached the university with a challenge: Breed soybeans that can meet the renewable fuel industry’s needs.

“We work very closely with those grower groups to identify target traits we should be working on,” Lorenz explains. “They have their ears closer to the ground. They can see what the industry needs better than we can and help direct our research. It’s been a very fruitful collaboration.”

He says it’s also possible soybeans looks more like canola, as a way to capture more of the oil content from every plant. But that research is just a hint of what may be to come.

Looking Ahead

From fields filled with the tall, spindly soybeans of the 1940s to test plots growing varieties rich in oil and nematode resistance, the University of Minnesota’s breeding program reflects decades of continuous innovation.

Each seed planted represents a future crop, and a future challenge, already being met by researchers like Lorenz and his team.

“As long as we continue the incremental progress of selecting and developing better varieties,” Lorenz says, “over the long term we’ll always have something that’s a lot better.”

How EPA's Proposal to Exempt Refineries From Blending Biofuels Impacts Farmers

Mon, 22 Sep 2025 22:30:02 GMT

The EPA’s latest proposal on how they plan to deal with the backlog of Small Refinery Exemptions (SREs) could have a major impact on farmers.

With a big crop this year, they need biofuels demand to help use those extra bushels.

However, even as recent as last week, small refiners continued to file for exemptions from the biofuels volumes they are mandated to blend under the Renewable Fuels Standard (RFS).

If EPA allows these waivers and the backlog of SREs from 2023 to 2025, without increasing the volumes in 2026 and 2027, it will mean lower biofuels production.

EPA’s SRE Proposal Includes Something Old
EPA’s latest proposal to deal with the backlog of Smaller Refinery Exemptions contains something old and something new.

The good news is EPA is using current methodology to calculate SREs, according to Paul Winters, director of public affairs, Clean Fuels Alliance America.

“They’re looking to protect the market space and preserve the volumes they set for the RFS standard — and that’s a good thing. That’s something we fought for back in 2020 and we’re glad to see that continuing.”

He says EPA’s proposal recognizes the SREs handed out in August have the potential to flood the RIN markets.

“They’re looking to reallocate those volumes and protect future RIN markets to make sure there isn’t a signal sent to the industry to undercut production in future years,” he adds.

A New Twist
However, to accomplish that, Winters says EPA has also offered a new proposal — with a twist.

He explains: “They are proposing to either reallocate 100% of the exemptions that have been handed out to date or 50%.”

The final decision will be based on the volumes of biofuels that will be produced in the future and ensure the volumes EPA is setting for 2026 and 2027 are actually met.

Winters says 100% reallocation is the best option for the biofuels industry, as EPA’s updated dashboard on SREs shows, since August 22, they’ve received 10 new exemption petitions for 2021 through 2024.

“We expect they’re going to continue filing more and more of these exemption petitions. So, EPA needs to adopt the 100% estimate based on what’s been filed so far. Because at the end of the day, that’s not going to represent 100% of all the exemptions that are eventually granted,” he further explains.

This is especially important for farmers because if the exemptions were granted without increased production, it would cut into biofuels volumes for 2026 and 2027.

45 Day Comment Period Underway
Winters says it’s key for farmers to be engaged in the process. EPA is holding a hearing on the rule within 15 days as part of a short 45-day comment period.

U.S. Biofuel Stocks Getting Hit

Thu, 11 Sep 2025 12:05:18 GMT

Shares of U.S. biofuel companies have slumped on fears Trump administration policies may fall short of fully offsetting exemptions from mandates requiring refineries to blend renewable fuels into gasoline and diesel. The Trump administration is considering a plan that would require large refiners to take on “half or less” of the blending obligations originally assigned to small refineries that received waivers, Reuters has reported, citing people familiar with the matter, said a Bloomberg report. Such a move would reduce near-term demand for crop- and waste-based fuels, tempering investor enthusiasm for biofuel producers following the EPA’s June proposal to significantly raise production quotas for 2026 and 2027. The issue has emerged as a key point of contention between farm and oil lobbies as they respond to Trump’s proposed biofuel policy. Shares of crop processors Bunge Global SA and Archer-Daniels-Midland Co. slumped the most since April on Wednesday. Ethanol suppliers Valero Energy Corp. and Green Plains Inc. plunged as much as about 5%. A key price indicator for biofuels — the so-called RINs — traded at the lowest levels since June.
Read more from Pro Farmer.

Can Biofuels Make Up for Lost China Soybean Export Demand?

Fri, 05 Sep 2025 19:04:31 GMT

China has still not bought one bushel of new crop soybean exports from the U.S. and they may not with U.S. product facing up to a 23% tariff.

Last year at this time China had bought 250 million bu. of U.S. soybeans but this year is buying from South America and without a China deal the U.S. could miss its prime export window which will further pressure soybean prices.

Can BioFuels Make Up for Lost China Export Business?

Due to the expected increase in demand for biofuels like renewable diesel and SAF the soybean processing industry was planning a 30% increase in crush capacity with the use of soybean oil as a feedstock.

With recent biofuels policy wins that finally looks more promising but experts says the biofuels ramp up won’t come soon enough to make up for lost exports to China.

Trifecta of Biofuels Policy Wins

The U.S. biofuels industry has had a trifecta of policy wins the last few months including EPA’s higher than expected proposed blending mandates for biomass based diesel according to Dr. Scott Irwin, Agricultural Economist, University of Illinois.

He says, “It started with the June Renewable Volume Obligations (RVOS’s) which were very healthy and included a what is called a half RIN proposal for imported biofuels or domestically produced biofuels made with imported feed stocks.”

A second positive was, as part of the One Big Beautiful Bill, the industry saw some much needed changes to the 45 tax credit program.

Steve Censky, Chief Executive Officer, American Soybean Association says the bill delivered many of the components they had asked for.

“Number one was to extend it because it was going to be expiring in 2028. And so it’s been extended for a couple of years. And then second thing is that we push to make the 45Z tax credit only available to fuels made with U.S. feed stocks,” he ssays.

Irwin says the third part of the hat trick was EPA’s decision on the backlog of Small Refinery Exemptions.

Irwin says, “We got an SRE refinery exemption u decision uh that stretches back going all the way back to 2016 that uh I believe is quite favorable as well.”

Biofuels Industry Awaiting Guidance on RVOs and 45Z

However, the biofuels industry has been waiting nearly two years for Treasury guidance on 45Z to get certainty for investment.

Irwin says, “We still have to wait to see what that guidance looks like. But the important point is that historically historically when those tax credits are awarded either to the uh blender or the producer they bid most of that into their feed stock prices.”

Censky says they also need finalized RVO levels from EPA, which are expected by October 31.

Censky, “f we can finalize the volumes that have been proposed by the EPA, and they propose to expand biomass-based diesel volumes by 67% from 2025 levels. So really historic announcements about the volumes. That really gives potential here for the biomass-based diesel industry.”

But that demand won’t kick in until January of 2026, so can biofuels make up for the loss of China?

Biofuels Ramp Up Too Late to Offset Lost China Exports

Irwin says, “The big thing of course is no matter how bullish you want to get on biofuels it doesn’t replace China on the soybean export side.”

Censky says that’s because while the U.S. soybean industry diversified its export portfolio since the 2018 trade war with China, it still buys over 25% of the soybean crop annually.

“I mean they import more soybeans than the rest of the world combined and so you can’t make up the loss of the China market by gaining a little bit here or there,” he explains.

And with up to 23% tariffs on U.S. soybeans, Censky says China is out of the new crop export market.

“So you’re talking 200 to 400 million bushels of soybeans that they would have purchased already that would be on the books and right now we have zero and what we’re hearing is that they’ve taken care of their needs for October, they’re taking care of their needs for November.” he says.

And without a deal, China could stay out of the U.S. export arena waiting for Brazil’s new crop soybeans to come to market.

EPA Decision on Small Refinery Exemptions Good News For Biofuels

Mon, 25 Aug 2025 17:18:47 GMT

The Environmental Protection Agency had a big announcement on Small Refinery Exemptions (SREs) on Friday.

The agency is acting on a backlog of more than 175-petitions from 38-small refineries dating all the way back to 2016.

EPA officials says the goal is to get the Renewable Fuel Standard (RFS) program back on track but biofuels industry officials are unclear about how that will work.

SRE Decision a Mixed Bag

EPA granted full SREs on 63 petitions to the Renewable Fuel Standard, and partial exemptions on 77. The agency also denied 28 petitions and deemed 7 ineligible.

Paul Winters, Director of Public Affairs, Clean Fuels Alliance America says the result was a good news, bad news story for the industry.

“The exemptions apply to more than 7 billion RIN gallons from prior years. However, EPA is indicating that it’s only returning RINs for 2023 and 2024, which is about 1 .4 billion RINs. Those RINs would still be valid to meet the 2024 RFS volume requirements.”

Will the 2023 to 2025 SREs be Reallocated?

The biofuels industry exoects multiple refiners to object to the decision. So the question remains: how or if the SREs from 2023 to 25 will be reallocated.

Winters says, “1.4 billion RINs returned to the market is a substantial number, especially for 2024 and 2025 where the Biden administration set volumes for biomass based diesel way below where they should have.”

EPA Proposes New Formula for Reallocating SREs

In addition, EPA has proposed a new formula to reallocate gallons exempted from 2023 and later years.

This means EPA still has 57 total exemption requests pending that will be used in finalizing blending levels for 2026 and 2027.

“So what EPA has indicated is that they are going to propose a rule, a supplement to the 2026 and 2027 volumes and they will reallocate the these small refinery exemptions to other refiners,” he says.

So, while the administration is trying to support the biofuels industry, it’s still negative according to Winters.

“They exempted far more small refineries than anyone thought would have,” he explains.

Timeline Unclear

Winters says EPA will send a proposal to the White House next week for a 30 day review, followed by a comment period and hearing on the new proposal.

Eventually the plan is to add this proposal to, for the new framework or small refinery exemption decisions and add it to the 2026 and 2027 RFS rule.

Winters says CFAA will work with EPA on the re-allocations but his will delay the final 2027 RFS rule past the November 1 deadline — adding more uncertainty.

High Yields, Poor Profits: Corn Farmers Search for New Demand to Drive Prices

Thu, 14 Aug 2025 15:19:58 GMT

USDA’s record 16.7 billion bushel corn crop estimate in the August WASDE is raising concern among farmers and farm groups — including the National Corn Growers Association.

They’re questioning the accuracy of USDA’s yield and acreage projections and asking for demand solutions to blunt the threat to the livelihood of farmers already facing record-low prices.

Corn Acreage a Double Whammy
Corn profitability was already in the red before the August WASDE.

But the record 16.7 billion bushel corn crop and 2 million additional acres just added insult to injury for Tom Haag, who farms near Eden Valley, Minn.

“When they first had their intentions earlier in June, I thought we were pretty close to where we were. I don’t know where they come up with these extra acres or where they found them,” Haag says.

Illinois and Iowa acreage was unchanged, but between the June Acreage Report and August Farm Service Agency (FSA) certified acreage, states including Kansas, North and South Dakota had 1.2 million more acres.

Some could be silage, but these are fringe states.

Krista Swanson, chief economist with NCGA, says even with record yields, those states can’t lift the national yield average.

“The higher acres are, the less likely we have an extremely high yield because of those fringe acres. I think that certainly comes into play, as maybe challenging ‘Can a yield of this level be hit?’”

Validity in Question
The yield methodology for the August report is also in question since it doesn’t use field data.

Swanson says, “So, what happens when we start to getting into harvest is left to be seen. You could analyze, ‘Well, if a state like Iowa has exceedingly high yields, then you wouldn’t necessarily need that record’. But you come out around 190 if every state achieves their maximum yield of the past five years.”

And the record yield projected for the No. 2 corn producer, Illinois, is debatable with crop ratings at only 63% good-to-excellent — well below last year.

Kent Beadle, Paradigm Futures, says that’s well below last year’s rating, and it has dropped 8% in the last few weeks.

“Right now, the good-to-excellent rating is suggesting an average Illinois crop, and of course USDA gave it a record at 221,” Beadle says.

USDA Lowers Average Corn Price
Swanson says as a result of the record supply, USDA lowered the national average corn price.

“USDA also reduced its projected market year average price for the 2025 crop from $4.20 down to $3.90. That would be the lowest market year average we’ve had since 2019.”

But cash prices are much lower in the country — pushing profitability further in the red for farmers like Haag.

Dec. Corn Profitability

(USDA)

Losing Money at This Price
“Our break-even at the farm is right around $4.25, and cash corn to where we haul today is $3.59,” Haag explains.

And with USDA’s cost of production on corn at $897 an acre, he isn’t the only farmer below break even.

Beadle says, “You know, at the 181-bushel level, we were going to need $4.95 on average for the average farmer to break even. If you add this 7.8 bushels an acre, you still need $4.75 to break even.”

Call to Action on Demand
The bleak outlook has NCGA issuing a call to action from Congress and the Trump administration, including year-round E15 — which could use an estimated 457 million bushels of corn.

“If we could get E15 — and also California to use E15 — that would burn up a lot more bushels,” Haag says. “A lot of states don’t have the infrastructure to burn E15, as their pumps are not set up. We need some adjustments there also from EPA to allow E15 to be used in your normal conditions like unleaded 87 is.”

Swanson says they’re also looking for demand in the export market.

"[We’re] also stressing the importance of continuing to work on some of these new trade frameworks and build international market access as well.”

Unfortunately, if help comes, it may not be in time to stop the bleeding at harvest time.

Will the Repeal of EPA's Endangerment Finding Pose a Danger to Biofuels?

Thu, 07 Aug 2025 16:51:32 GMT

For years, efforts to regulate greenhouse gas emissions (GHG) from fossil fuels has helped support the growth of the biofuels industry. However, EPA has released a proposal to void it’s 2009 endangerment finding that declares GHG emissions, including carbon dioxide, no longer be a threat to the environment.

EPA’s proposal to reverse the Endangerment Finding returns the Clean Air Act to its original purpose, overturning the previous administration’s attempt at climate control via regulation. Under the Trump administration, the move signals EPA is going to de-emphasize carbon in energy and environmental policies.

Is Voiding the Endangerment Finding a Danger to the Biofuels Industry?

Jordan Fife, president of trading, BioUrja says depending on what the final proposal looks like it could be a game changer.

“If you were to classify carbon as a non-greenhouse gas, and therefore, you would not be able to sequester it and monetize it. So it would be a very big deal.”

Fife says it could also negatively impact carbon pipelines and the carbon markets tied to biofuels.

“It’s not just the pipeline — it’s the actual downstream sequestration. You look at One Earth Energy that’s in Gibson City, Ill., or Indicator, Ill., where ADM is the largest sequester of carbon currently in the country. All of that becomes pretty null and void if carbon is no longer classified as a greenhouse gas,” Fife explains.

Monte Shaw, executive director of the Iowa Renewable Fuels Association, agrees the ruling could mean farmers will have a harder time getting paid for carbon reducing practices as part of 45Z.

“I don’t think you’re going to see voluntary actions by the EPA, by the USDA that are tied to carbon metrics for farming. I could be surprised, but I don’t personally anticipate that happening with or without this finding,” Shaw says.

In fact, he stresses there was no assurance of a payment for farmers for carbon sequestration under 45Z.

“The 45Z calculation today, under the current guidance, does not include a way for the farm practices to be accounted for,” he says.

What is the Potential Impact on Biofuels Policy?

However, when it comes to biofuels policy itself, Shaw says 45Z and the Renewable Fuels Standard will see little to no impact: “The first thing people need to know is it doesn’t affect those at all. Those are laws passed by Congress. The RFS was passed by Congress. 45Z was recently passed by Congress. Those are not EPA regulations that are dependent upon this finding. To change 45Z or to change the RFS, you would actually have to change the law.”

Shaw says EPA’s proposal does send a chilling signal to the marketplace but it won’t halt the Sustainable Aviation Fuel market.

States such as California with their Low Carbon Fuel Standard will also be exempt from this finding.

“We have states that are requiring certain things, both on the transportation side, vehicles, as well as increasingly on airlines as well,” Shaw says. “We have huge markets for ultra low -carbon ethanol both domestically and internationally that are not tied to EPA regulations.”

Ruling Could Unleash Lawsuits

He thinks this proposal will spark a rash of climate lawsuits but that those legal challenges will fail due to the Chevron ruling.

“Basically what the courts have said recently is if Congress wants an agency to do something that’s big, they need to tell that agency, and I think regulating CO2 qualifications qualifies as big, right? I actually think this will hold up to the judicial challenges,” Shaw says.

Soybeans Are Searching For a Demand Story, And Something Big is Brewing

Mon, 21 Jul 2025 21:22:29 GMT

Growing soybeans in Ohio this year has been a bit of a roller coaster ride.

“We faced some wet weather early, especially in the month of May where it was cold and wet,” says Steve Reinhard, a north-central Ohio farmer in Bucyrus. “At the end of May, we got in and finished up corn and soybeans. Things really look pretty decent right now. I think conditions are probably a little more varied in Ohio than maybe some other places.”

Wading Through Challenges
While farmers such as Reinhard are focused on big yields, they have been wading through a number of challenges this year.

In addition to $10 soybeans, tariffs are hanging over the export outlook — an important factor considering about half of the soybeans growing across the U.S. will be exported.

“Soybeans are still United States ag’s No. 1 export industry at about $31 billion provided back to the economy. It’s definitely a market we’re looking at while also stressing more domestic use as well,” says Reinhard, a former chair of the United Soybean Board (USB).

The Current Export Picture
In April, the trade war with China seemed to be heating up. A tariff tit-for-tat caused U.S. soybeans to face a tariff rate of nearly 115%. While short-lived, China still hasn’t been back to the table to buy U.S. soybeans. Even in the wake of the high tariffs in April, the reality was China remains the top export destination for U.S. farmers — even if the country isn’t buying as many soybeans as it did in 2018.

According to Pro Farmer reports:

China imported 10.62 MMT of soybeans from Brazil in June, about 86.6% of total imports and up from 9.72 MMT a year ago.
China imported 1.58 MMT from the U.S., about 12.9% of total imports for June and up from 1.31 MMT a year ago.

The good news is soybean export sales for the 2025/2026 marketing year have seen an uptick lately. According to Terrain, the recent sales contributing to the growth have been from a combination of “other Asia,” “unknown” and “Western Hemisphere” regions.

“The ‘other Asia’ is several countries, including Bangladesh, Indonesia, Malaysia, Pakistan, Philippines, Thailand and Vietnam mostly. The ‘Western Hemisphere’ category is almost entirely Mexico,” says Marc Rosenbohm, senior grain and oilseed analyst for Terrain.

When it comes to the “unknown” destinations, he doesn’t want to speculate.

Outstanding Soybeans Sales

(Terrain)

Soybean Sales

(Terrain)

"[Sales] are still at fairly low levels, but hopefully we can keep the momentum going as we get closer to the start of the marketing year,” Rosenbohm says.

Drumming Up More Domestic Demand
Not losing sight of growing exports, while finding more domestic demand, is a focus for USB at a critical time.

“I think the big one we can look at is feed use in the United States,” Reinhard says. “As we look at the increased demand for soybean oil — when we crush the soybean, we get oil and meal. So, we need to look at how we can put more meal into the animal agriculture industry.”

The Top Domestic Customer
From poultry to pork, animal agriculture is the largest end user of soybeans — with livestock consuming 97% of soybean meal produced in the U.S. Keeping that in mind, USB is working to find ways to bring more benefits to animals.

“For instance, in the pork diet, we’re providing antiviral and anti-inflammatory benefits to those younger pigs. We’re able to help with respiratory diseases and improve summer health of the animals, especially under the severe heat stress,” Reinhard says.

One area demand growth is gaining traction is in dairies.

“When we came up with the high oleic [soybean], we were looking at the human health aspects of no trans fat, no saturated fat and great for cooking. What we didn’t intend is how that benefits the dairy industry,” he adds. “It provides a really big improvement on milk fat yield. That’s one of the components dairy gets paid on, and we hope to expand that market as well.”

High oleic soybeans have been on the market since 2012, but the latest discovery is proof researchers are continuing to uncover new and useful benefits for the variety of soybeans bred to have a higher percentage of oleic acid in their oil.

“I think we’re starting to scratch the surface on what high oleic soybeans can do,” Reinhard says. “There are some things high oleic can’t do that conventional soy can since it’s a little bit different oil composition.”

Fueling Demand in a Big Way
Finding new domestic uses for American-grown soybeans is something that gives this Ohio farmer hope. But what is he most excited about? It’s the possible boost in biofuels.

EPA set the stage for a big boost to biofuels in June . That’s when the agency released its proposed blending mandates for biomass-based diesel in the renewable fuel standard. The proposal would increase biomass-based diesel requirements from 3.25 billion gallons in 2025 to 5.61 gallons in 2026. If made final, it would be a potential game changer for soybean farmers.

“Everybody’s going to be happy with the fact we’re going to increase the proposed volume requirement by 67% to 5.61 billion gallons,” says Peter Meyer, principal economist and partner, Muddy Boots Ag LLC. “Now the question is, does that mean we’re going to have to use every available pound of soybean oil toward renewable diesel? It certainly will be. There’s no question.”

Meyer says EPA’s proposal and the potential boost in demand for soybean oil could also drive soybean acreage higher in 2026.

A Game Changer for Farmers
Another big component of EPA’s proposed rule is the fact EPA also wants to restrict the amount of imported foreign feedstocks used in renewable fuels production. According to Marc Rosenbohm, senior grain and oilseed analyst for Terrain, that would put U.S. production of renewable fuels made from U.S. feedstocks, such as soybeans, at a significant advantage.

“We expect soybean oil to play a significant role here,” Rosenbohm says. “Part of that uncertainty is exactly what level it might play related to the RVO proposal. So, I think getting that finalized first will be important for knowing exactly what level of soybean oil we need.”

USDA acknowledged that potential growth in the July World Agricultural Supply and Demand Estimates (WASDE) report earlier this month, forecasting a record 53% of soybean oil usage in the U.S. will go to biofuels.

“They brought up biofuel use of soybean oil to 15.5 billion pounds, which now exceeds the food consumption category — which I think is an important psychological piece of it. We are using a lot of soybean oil for biofuel use, as incentivized by those policies. They also did increase crush to a little over 2.5 billion bushels,” Rosenbohm says.

For AgResource’s president and founder Dan Basse, it’s the boost in biofuels that would fuel the demand story in soybeans — especially if exports continue to navigate tariff threats and uncertainty on trade.

“I believe we need to continue to think about the future opportunities in green fuels and build out that sector,” Basse says. “United States agriculture will struggle with trade unless the Trump administration is able to open up some of these markets. So, my mindset is, looking outside the United States, there’s still tremendous growth in green fuels.”

It’s Not Growing Exports or Domestic Demand: It’s Both
For Reinhard, it’s not whether the soybean industry should focus on growing domestic demand or growing exports. It’s an unwavering focus on both that will drive prices and demand.

“You have an administration now that’s working with different countries to provide different trading opportunities. As we go forward, I think we continue to see our yields increase over time,” Reinhard says. “I don’t see our production going down or being stagnant. So, I think we still need to continue to work on all of our markets and use the great production and ingenuity the U.S. farmer brings forward.”

5 Things Farmers Should Know Now 45Z Is A Real Thing

Mon, 07 Jul 2025 22:09:52 GMT

The One Big Beautiful Bill (OBBB) delivered additional surety for the 45Z biofuel blender tax credit.

After almost three years of talking about what could be spelled out by 45Z, Mitchell Hora says farmers can now get “locked in” to capitalize on the program.

“This 45z deal could be absolutely game changing for my family’s farm, and I think it will be game changing for other family farmers across the country,” Hora says. “It’s going to have a ripple effect that could change global agriculture. So that’s why I’m just so adamant that we have got to get this right, and we’ve got to hit the ground running.”

Hora, an Iowa farmer and founder of Continuum Ag, says there are five things every farmer should know about what the OBBB has laid out. He also says there are unanswered questions.

1. It’s happening.

“They [lawmakers] cut almost all of the other green funding programs within the Inflation Reduction Act. They cut a bunch of that old stuff, but they kept the 45Z program,” Hora says. “It’s alive, it’s locked in, it’s going to happen.”

What sets 45Z apart from previous biofuels tax provisions is how it measures the grain—the program uses a scorecard to assess every bushel (not acre) with a carbon intensity (CI). Any score under 50 points receives a tax credit to the biofuels producer.

“This program shows how you can score a farmer’s carbon footprint, how you can audit it, verify it, track it through the supply chain, and how to monetize it,” Hora says.

2. OBBB gave 45Z an extension

The 45Z program now has additional momentum behind it as the OBBB outlined an extension now into 2029.

“Now biofuels producers have more time to really capitalize on this,” Hora says.

The program is currently active for the 2025 tax year. This means farmers could be selling 2024 grain into the 2025 biofuels production year. And the program is available through 2029.

3. Only North American feedstocks are eligible.

Imported used cooking oil has become a focus for may who have critiqued previous blend credits as feedstocks from other countries were not limited.

Now, only feedstocks from North American sources can be used as part of this program. This includes corn, soybeans, used cooking oil, beef tallow, and canola.

“Without foreign feedstocks being included this drives more demand and more value for U.S. farmers,” Hora says.

4. Current language ignores indirect land use change.

“This single thing lowers everyone’s CI score across the board. It definitely helps corn and corn based ethanol and the soybean side as well,” Hora says.

5. Tax credits are transferrable.

Biofuels producers can take their tax credits and sell them to another buyer if they aren’t going to use them themselves.

Additionally, this makes it easier for farmer-owned co-op ethanol plants to process their taxes.

Additional considerations and unanswered questions.

Farmer data is key to unlock the potential.

“The overall 45Z impact is ag data is extremely valuable. It’s setting a precedent as to the value for data,” Hora says. “Iin order for the ethanol plant to generate 45Z credit using your low carbon farming practices, they have to prove it in an audit, and likely an audit at every point of aggregation, so that farmer data is really the key to unlock value here.”

As for the monetary value of the CI score, Hora says after talking to hundreds of ethanol plants, the range of sharing the value of the credit varies between 30% to 50% of the value.

This 45Z program update does effect sustainable aviation fuel—particularly alcohol to jet.

“Under the current version of 45z the alcohol to jet pathway not going to happen at any type of real pace, not at any type of accelerated rate of innovation. The math just doesn’t work out,” Hora says. “You’d be much better off under the current 45Z rules to just sell it as ethanol.”

The Final IRS Guidance Matters

Forthcoming final rules from the IRS will set which of the two calculators will be used: GREET FD-CIC or USDA FD-CIC

Also, the IRS sets if the credits will be tracked with mass balance or book and claim method.

“Here’s the takeaway for farmers. You can continue to wait. But you’re money ahead to get your data organized,” he says.

The money is flowing—yet.

“There may be small amounts, pennies on the dollar to get things started and get farmers enrolled. This didn’t unlock the flood gates. But it locked it in. It’s here to stay. They are going to get these rules out. We’ve got to get some movement on the work ahead to get the data and the people ready,” Hora says.

You may want to pump the brakes on signing up for a new private carbon program, Hora says. Because all previous guidance has not allowed for signing up an acre for one program and selling a bushel under 45Z from the same land.

There will be ripple effects (and opportunities) for animal agriculture.

Hora says, “If you are in animal ag, talk to people in your supply chain. And talk about how to capitalize on this precedent setting program.”

Congress Split on Biofuel Tax Credit Overhaul

Mon, 23 Jun 2025 20:40:49 GMT

The House and Senate reconciliation bills both propose major changes to the 45Z Clean Fuel Production Tax Credit, aiming to extend and reshape federal support for biofuels. While both chambers extend the credit through 2031 and relax greenhouse gas (GHG) emission calculations by excluding indirect land-use change, they sharply diverge on rules for feedstock sourcing, credit value and how flexibly the credits can be transferred.

House Reconciliation Bill

45Z credit extension: Extends the 45Z credit through Dec. 31, 2031, replacing prior biofuel subsidies like the ethanol tax credit (VEETC) and biomass-based diesel credit.
40B credit extension: No provision.
Feedstock restrictions: After Dec. 31, 2025, fuels must use feedstocks exclusively grown or produced in the U.S., Canada or Mexico to qualify. Foreign feedstocks are banned.
Emissions calculation: Indirect land-use change emissions are excluded from greenhouse gas (GHG) assessments, making conventional biofuels (e.g., corn ethanol) more likely to qualify.
Credit value: Offers up to $1.00 per gallon for non-aviation fuel and $1.75 per gallon for aviation fuel if wage/apprenticeship requirements are met.
Manure-based biogas: Transportation fuels derived from animal manures — including dairy, swine, and poultry waste — are eligible for the 45Z credit. Distinct emissions rates for manure feedstocks. Rather than applying a generic carbon-intensity rate, mandates unique emissions rates for each type of animal manure, increasing accuracy and improving credit certainty.
Transferability: Repeals transferability for fuel produced after 2027.
Foreign ownership limits: Significantly broadens definition of a “Prohibited Foreign Entity” (PFE), covering both “Specified Foreign Entities” and “Foreign-Influenced Entities.” Covered entities: Includes Chinese military companies, entities subject to the Uyghur Forced Labor Prevention Act, battery producers ineligible for DOD contracts (e.g., CATL, BYD, Envision, Gotion), and any entity controlled (over 50% ownership or beneficial interest) by China, Russia, North Korea, or Iran. Scope: The bill prevents most IRA energy tax credits from being claimed by companies that are PFEs or that have significant business relationships (licensing, sourcing, payments) with PFEs. Attribution: The House bill applies strict attribution rules, potentially sweeping up public entities and complex ownership structures.
Cost impact: Estimated to cost $45 billion from 2025–2034, with $8.5 billion in FY 2031 alone. Critics argue this subsidizes mature industries without incentivizing innovation.

Senate Reconciliation Bill

45Z credit extension: Extends 45Z through 2031.
40B credit extension: Short-term extension of the 40B credit. Specifically, the extension covers biodiesel and renewable diesel produced through Sept. 30, 2025. This extension is designed to provide a bridge for producers as the industry transitions to the 45Z credit.
Feedstock rules: Allows foreign feedstocks but imposes a 20% reduction in credit value for fuels using non-U.S. feedstocks after Dec. 31, 2025.
Emissions calculation: Also excludes indirect land-use change emissions.
Aviation fuel: Retains the SAF premium but removes land-use change accounting.
Manure-based biogas: Actively encourages biogas from animal waste, like the House bill. It not only qualifies manure-derived fuel but also enforces manure-specific carbon accounting, a policy feature aimed at rewarding genuine GHG reduction through waste-derived energy.
Transferability: Maintains full transferability for the credit’s duration, unlike the House version.
Foreign ownership limits: FEOC rules retained, but modified: The Senate bill keeps the House’s framework but makes several clarifications and adjustments to make the rules more administrable for industry. Thresholds and control: The Senate increases the ownership and debt thresholds that trigger restrictions, making it less likely for minor foreign involvement to result in credit denial. Payment rules: Only payments to a foreign entity that result in “effective control” (rather than any payment over a low threshold) can trigger a denial of credits, which is less punitive than the House version. Effective Dates: The Senate bill delays the effective date of these restrictions compared to the House, providing a longer transition period for compliance. Complexity: While more workable, the Senate approach still introduces administrative complexity and the risk of inadvertent credit denials due to nuanced attribution rules.
Cost structure: No direct cost estimate, but the 20% reduction for foreign feedstocks aims to curb spending while supporting domestic agriculture.

Final legislation will need to bridge these differences. The House is pushing for strict domestic sourcing and large, less-flexible subsidies, while the Senate aims for a more moderate approach that balances support for U.S. agriculture with fiscal restraint and international trade considerations.

Sign up for more ag policy updates from Pro Farmer - view subscription specials.