Missouri farmer says year-round E15 sales would help the agriculture industry

7 months 2 weeks 6 hours ago Wednesday, October 10 2018 Oct 10, 2018 Wednesday, October 10, 2018 12:47:00 PM CDT October 10, 2018 in News
By: David Estrada, KOMU 8 News Reporter & The Associated Press
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BENTON CITY - As farmers feel the pinch of recent tariffs, they are welcoming a new presidential announcement which could mean more money in their pockets.

Farmer Jay Schutte said President Trump's decision to allow year-round sales of gasoline with 15 percent ethanol would benefit farmers across the country, including him.

"The Trump administration realizes that farming is not doing too well economically, right now," he said. "With the trade wars and everything else, you can see how China can pull out of our markets and it hurts the farmers very much."

Schutte, who chairs the Ethanol Action Team of the National Corn Growers Association, runs a farm that has been in operation for more than two generations. He produces corn, soybean and feed cattle. 

"My mom and dad started this farm in 1952, and it's been handed down to my brothers and I," he said. 

Schutte said ethanol isn't just good for farmers.

"Pure ethanol is the cheapest liquid fuel, out there in the market, the cheapest form of octane busting," he said. "It's just a shame that we can't get it included higher in the marketplace."

Schutte said E15 year-around sales could also have a benefit for drivers. 

"They anticipate that the price of gasoline could go down, as much as a nickel to a dime," he said. 

Gasoline typically contains 10 percent ethanol. The EPA currently bans the high-ethanol blend, called E15, during the summer because of concerns that it contributes to smog on hot days. That's a claim ethanol industry advocates say is unfounded.

President Trump said he wants to encourage more energy production and help farmers and refiners.

The White House said the Environmental Protection Agency will publish a rule to allow high-ethanol blends as part of a package of proposed changes to the ethanol mandate.

Government officials said the proposed rule intends to allow E15 sales next summer. Current regulations prevent retailers in much of the country from offering E15 from June 1 to Sept. 15.

Lifting the summer ban is expected to be coupled with new restrictions on trading biofuel credits that underpin the federal Renewable Fuel Standard, commonly known as the ethanol mandate. The law sets out how much corn-based ethanol and other renewable fuels refiners must blend into gasoline each year.

The Renewable Fuel Standard was intended to address global warming, reduce dependence on foreign oil and bolster the rural economy by requiring a steady increase in renewable fuels over time. The mandate has not worked as intended, and production levels of renewable fuels, mostly ethanol, routinely fail to reach minimum thresholds set in law.

The oil industry opposes year-round sales of E15, warning that high-ethanol gasoline can damage engines and fuel systems of older cars and motorcycles. Some carmakers have warned against high-ethanol blends, though EPA has approved use of E15 in all light-duty vehicles built since 2001.

A bipartisan group of lawmakers, many from oil-producing states, sent Trump a letter last week opposing expanded sales of high-ethanol gas. The lawmakers called the approach "misguided" and said it would do nothing to protect refinery jobs and "could hurt millions of consumers whose vehicles and equipment are not compatible with higher-ethanol blended gasoline."

The letter was signed by 16 Republicans and four Democrats, including Texas Sen. John Cornyn, the No. 2 Republican in the Senate, and Sen. John Barrasso, R-Wyo., chairman of the Senate Environment Committee.

A spokeswoman for the Renewable Fuels Association, an ethanol industry trade group, said allowing E15 to be sold year-round would give consumers greater access to clean, low-cost, higher-octane fuel while expanding market access for ethanol producers.

"The ability to sell E15 all year would also bring a significant boost to farmers across our country" and provide a significant economic boost to rural America, said spokeswoman Rachel Gantz.

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