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LINCOLN, Neb. (DTN) -- Agriculture interests are pushing Trump administration officials to act on several key issues related to the 45Z Clean Fuels Production tax credit, telling them in a letter on Wednesday struggles in the ag economy warrant swift action.

The ag groups said for 45Z to function as it should, three actions are "urgently" needed.

The 45Z is in effect until 2029 and is a key driver in the development of a sustainable aviation fuel industry using agricultural feedstocks.

That includes having USDA's updated guidance and carbon intensity calculator transmitted to and processed through the Office of Management and Budget.

The groups asked the Department of Energy to include USDA's updated CI calculator in the updated 45Z-CF GREET model.

"Finally, Treasury must adopt guidance to formally recognize the ability of verified on-farm practices to lower CI scores in a way that does not distort planting decisions," the letter said.

"To maximize farmer participation and ensure the program's success without disrupting the nation's highly efficient grain markets and logistics, treasury should incorporate book-and-claim alongside mass-balance supply-chain traceability systems."

The letter sent to U.S. Secretary of Energy Chris Wright, U.S. Agriculture Secretary Brooke Rollins, U.S. Treasury Secretary Scott Bessent and Russell Vought, director of the Office of Management and Budget, was signed by 28 national and state farm groups.

Those groups include National Corn Growers Association; American Soybean Association; National Sorghum Producers Association; Renewable Fuels Association; Growth Energy; National Oilseed Processors Association; Clean Fuels Alliance America; The SAF Coalition; Alabama Soybean and Corn Association; Illinois Corn Growers Association; Indiana Corn Growers Association; Iowa Corn Growers Association; Kansas Corn Growers Association; Kentucky Corn Growers Association; Michigan Corn Growers Association; Minnesota Corn Growers Association; Missouri Corn Growers Association; Nebraska Corn Growers Association; North Dakota Corn Growers Association; Ohio Corn and Wheat Growers Association; South Dakota Corn Growers Association; Tennessee Corn Growers Association; Texas Corn Producers Association; Virginia Grain Producers Association; Wisconsin Corn Growers Association; Texas Grain Sorghum Association; New Mexico Sorghum Producers; and Nebraska Sorghum Producers.

"Farmers are facing structural economic issues where projected costs exceed expected revenues," the groups said in the letter.

"As you know, biofuels are a critical market for American farmers, and tax incentives like the 45Z tax credit are essential policy instruments to secure long-term demand for liquid fuels made from American-grown feedstock."

They said "stable," long-term market incentives will help farmers "outpace their global competitors," and allow them to make capital, input and management decisions that shape the next several growing seasons.

"Ensuring that farmers can reap the potential market benefits of the 45Z tax credit comes at a critical time for farmers across the country," the groups said.

"Without this regulatory clarity, farmers, biofuel producers, and lenders may lack the certainty required to invest and participate at scale. Agricultural conservation practices, such as use of cover crops and no-till or strip-till, improve soil structure and organic matter, increase water infiltration, and enhance drought tolerance. These outcomes reduce crop damage during periods of excessive precipitation while also stabilizing yields under drought stress ultimately lowering risk and reducing indemnity payments. 45Z can serve as a catalyst for creating an environment that enables these practices to scale."

Adopting regenerative ag practices, the letter said, comes with increased cost implications that are lessened by 45Z.

"Farmers often must make significant capital investments in equipment, absorb variable costs such as cover crop seed, and undertake significant management changes," the ag groups said.

"Especially in a distressed farm economy, these investments are not practical without a predictable and bankable return. Clear 45Z guidance is critical for farmers and their lenders to plan with confidence. Without regulatory certainty on the inclusion of on-farm practices, those incentives will not materialize at the scale necessary to drive participation."

Incorporating on-farm practices into 45Z for carbon-intensity reductions, the letter said, "will shape future market opportunities" beyond liquid fuels.

"As row crop commodities increasingly serve as biofeedstocks for bioplastics, biotextiles, and biochemicals, this guidance can serve as a durable framework for farmers to expand their income streams," the groups said.

Todd Neeley can be reached at todd.neeley@dtn.com

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