There are plenty of reasons for optimism in the corn ethanol industry — record production, a higher mandate for biofuels in the gasoline supply and the inauguration of an ethanol supporter, Donald Trump, as president. All the same, the industry is looking for reassurance that the Trump administration will be a friend, considering that prominent federal appointments have gone to ethanol critics.
“I get all the angst,” the president of the Renewable Fuels Association, Bob Dinneen, told an industry conference in Iowa, according to the Des Moines Register. “It’s Donald Trump’s administration and they (cabinet nominees) understand what the boss wants from this program.” Iowa Gov. Terry Branstad, tabbed to become U.S. ambassador to China, said Trump “knows who his friends are. The fact that farmers and rural America supported him to such a great degree, especially here in Iowa, the heart of ethanol production, that’s important to him. And I don’t think it’s something that he’ll forget.”
Washington lobbyist Jim Massey predicted at the Iowa conference that the House will pass a bill this year to limit the ethanol blend rate to 10 percent, reported Successful Farming. Dinneen “didn’t argue with that but added that … any bill to weaken the RFS (Renewable Fuels Standard) would likely die in the Senate.”
The Energy Department says ethanol production averaged 1 million barrels a day in 2016, equalling 15.3 billion gallons, an industry record. The DOE’s Energy Information Administration says production “is forecast to average around 1.0 million barrels a day in both 2017 and 2018.” Consumption is forecast around 940,000 to 950,000 barrels a day, meaning ethanol will average 10 percent of the gasoline supply, “as only marginal increases in higher-level ethanol blends are assumed to occur … ”
The EPA effectively set the corn ethanol mandate at 15 billion gallons for this year, the first time that mandate is at the maximum provided by law. The agency has discretion to lower the biofuels targets, which it has used in the past, repeatedly in the case of so-called advanced biofuels. The EPA usually proposes in May the RFS for biofuels in the coming year, so this spring may bring an early marker of how Scott Pruitt, the Trump nominee for EPA administrator, will carry out his promises, during confirmation hearings, to enforce the law.
Wisconsin Rep. Jim Sensenbrenner filed bills this week to require a National Academy of Sciences report on the impact of using ethanol blends higher than the traditional 10 percent and to effectively end the mandate for use of cellulosic biofuels, made from grasses and woody plants. Sensenbrenner, an ethanol critic, said the bills would ensure that EPA biofuel targets are based in reality.