Ethanol Blog

Governors' Biofuels Coalition Presses Congress to Pass Financial Assistance for Biofuels Industry

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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The Governors' Biofuel Coalition has asked congressional leaders to include financial assistance in a future COVID-19 relief package. (DTN file photo)

With biofuels producers facing tough times during the COVID-19 economic shutdown, the leaders of the Governors' Biofuels Coalition asked congressional leaders on Thursday to include in any new economic relief package financial assistance for an industry suffering from lost fuel demand during the pandemic.

Both the House and Senate have introduced legislation to aid.

In a bill passed by the House producers could receive 45 cents per gallon for fuels produced between Jan. 1 and May 1, 2020. A Senate bill includes a provision to reimburse biofuels producers for feedstock purchases.

"The states in the Governors' Biofuels Coalition are facing unique challenges," South Dakota Gov. Kristi Noem and Minnesota Gov. Tim Walz, said in a letter to congressional leadership on Thursday.

"While farmers continue to produce the livestock and grain necessary to feed and fuel the nation, processing facilities have closed or dramatically curtailed production. Stay-at-home orders across the country slashed gasoline consumption, causing demand for ethanol to plummet, forcing more than 50% of the states' ethanol production to shut down."

The governors said the biofuels industry has seen "worker layoffs, lost markets for farm commodities, and constrained supplies of critical ethanol co-products like animal feed, corn distillers' oil used to make biodiesel, and captured carbon dioxide used in medical equipment, food and beverage processing, refrigeration, wastewater treatment and other applications."

The letter said the ethanol industry stands to lose "at least" $10 billion in 2020 as a result of the COVID-19 shutdown.

"Rural America -- with the ethanol industry's 350,000 direct and indirect jobs -- is facing an economic crisis of historic proportions," the governors said.

The letter said economic relief would "allow important agricultural-processing facilities to retain their employees, resume production when warranted by market and health conditions, and support farmers by increasing commodity demand."

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