NCGA's Edgington Eyes Big Ag Issues

LINCOLN, Neb. (DTN) -- Newly elected National Corn Growers Association President and Iowa farmer Chris Edgington has been on the job only a few days, but already he's hearing a laundry list of concerns farmers have from federal ethanol policy, tax policy, the regulatory reach of the EPA, to trade policy and rising input costs.

The St. Ansgar corn and soybean farmer said he shares the same concern many farmers have about how the Biden administration will approach federal biofuels policy. Farmers and ethanol producers are waiting to see the EPA's expected Renewable Fuel Standard volumes proposals for 2021 and 2022, as well as a potential cut to 2020 volumes.

Whatever is in the proposal, Edgington said, will challenge the trust farmers may or may not have in the Biden administration.

"It certainly is not going to help trust if he lowers it (RFS volumes) and goes against what he campaigned on and then a year later to do something different," Edgington said during a zoom call with agricultural journalists on Tuesday.

"That is not the way to move forward as a team. I understand people are all excited about electric vehicles, and they have a place."

Edgington said ethanol, biodiesel and renewable diesel are "here and now" and are "very immediate ways" to improve the environment to lower the cost to the consumer.

Some media reports indicate the EPA could reduce the conventional-biofuels portion of the RFS to something lower than 15 billion gallons.

Earlier this week, Growth Energy filed a petition with the Supreme Court, asking for a review of a decision by the U.S. Court of Appeals for the District of Columbia Circuit that vacated the decision by EPA to allow year-round E15 sales.

The Supreme Court is the last legal option to keep those sales intact. If that falls short, Edgington said, the legislative avenue would be one way to restore E15.

"We do have champions in Congress that are working to add a few words to the current legislation we have that will allow E15 to be sold year-round," he said.

"It's a tremendous product. It's great for the consumer, it's great for the environment and so we will continue to work with whatever avenues are presented to us, or with any other opportunities to continue to push the value of E15 on a year-round basis."

EPA HEADWINDS

As is the case with every administration, agriculture continues to face a number of EPA headwinds, including waters of the United States and renewable fuels.

Edgington said he was encouraged by EPA Administrator Michael Regan's willingness to listen to agriculture's concerns.

"Sometimes we're on the same page and sometimes we're not," Edgington said.

"Sometimes we're in court siding with them and sometimes we're in court against them. And so, it seems to be that our challenges with EPA or our opportunities to work together will be there on many, many issues. The current administrator has been very forward, very frank and he wants to work with us. He says we may not agree on everything, but we need to work together as a team. At least we will have a good, robust discussion around those issues and how we got to the point we're at."

Edgington said his group would continue to work with members of Congress to make sure ag producers' concerns are front and center in ethanol and tax policy discussions.

NCGA will be working, he said, to pass the Next Generation Fuels Act. The measure would increase gasoline octane to a minimum standard through low-carbon, renewable fuels.

TRADE, TAX CONCERNS

Congress is considering a plan to raise taxes on farmers by removing the stepped-up basis provision, raising capital gains taxes, raising inheritance levels, and lowering the 1031 exchange limits.

Edgington said the threat of higher taxes "has us all concerned about profitability."

"It's going to take all of us in agriculture, working together to persuade them to drop this bad idea," he said, "and I believe we can get this done."

Just recently, the Biden administration announced its plans on trade. Edgington said NCGA wants the administration to be aggressive on that front.

"We want the Biden administration to be proactive in their approach to trade," he said.

"We've got some long-term partners, Mexico and Canada, that we've done a lot with and yet we maybe have some challenges with them. That's why USMCA is such a great piece of material. China is obviously the wild card, and right now we seem to have pretty decent trading relationships with them, but we want to build on that Southeast Asia region that is continuing to grow as people add demand for food products and other products."

Edgington said the U.S. needs to spend more time "encouraging and educating the European Union that what we produce is a safe wholesome product that they need to utilize.

"So, our message simply is we need trade, and we need more trade, and we will take it in all places from all countries, because we are a good trading partner and a reliable supplier," he said.

RISING INPUT COSTS

As many farmers across the country wrap up harvest, much of their attention has turned to next season, and in particular, what to do about rising inputs costs.

Fertilizer prices in particular have continued to rise.

DTN's Sept. 29 update showed retail fertilizer prices were significantly higher than one year ago, with prices ranging from 39% to 85% higher compared to last year. DTN surveys more than 300 retailers, gathering roughly 1,700 fertilizer price bids, to compile the DTN Fertilizer Index each week.

"Not only is it the price, but is it the supply," Edgington said.

"Can they even get it because we're also hearing that once we get through the inventory that the fertilizer dealers carried into the fall, their replenishment stock is not real great. So, yes, it is a concern. It will probably be a deciding factor on some people whether they go with corn, soybeans, wheat, or possibly no fertilizer at all on some of those crops as far as P and K.

"The supply is not equaling the current demand situation, so it will be a scenario we will be working not only this fall, but it's going to go into next spring and potentially even in the next fall."

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

Follow him on Twitter @DTNeeley

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