Farmers reeling from President Donald Trump’s trade war with China suffered a new blow last week when his administration exempted dozens of oil refineries from requirements to use biofuels. The decision reduces demand for corn-based ethanol, slicing even deeper into farmers’ tanking incomes.
Waivers granted by the Environmental Protection Agency to 31 small petroleum refineries effectively exempts them from having to use more ethanol in their products.
“They screwed us ... when they issued 31 waivers,” Sen. Chuck Grassley (R-Iowa) told Iowa Public Television Friday (in the video above). He said fewer than 10 waivers were granted during “all the Obama years — and we thought that was bad.”
Grassley added: “What’s really bad isn’t a waiver, it’s that it’s being granted to people that really aren’t [in financial] hardship,” while farmers are suffering a record number of bankruptcies. He said the “buck stops at the Oval Office.”
Curt Mether, president of the Iowa Corn Growers Association, called the waivers “ridiculous” and a “slap in the face to farmers.”
Trump called EPA head and former coal lobbyist Andrew Wheeler personally to tell him to grant the waivers, sources told Reuters. “The president has heard from all sides and in the end, he has had enough of it. He called Wheeler and gave him the green light,” one source explained.
Trump’s call signaled support for energy companies over farmers, whom he has hailed as “great patriots” willing to put their livelihoods on the line for his trade war. American farm income has plunged by almost half since 2013 — and dropped 16% last year alone.
The decade-old federal Renewable Fuel Standard Program requires refineries to blend corn-based ethanol into their gasoline — or buy credits from those that do. But small refineries can obtain exemptions if they can convince the EPA that complying would create financial hardship.
Since Trump took office, the EPA has more than quadrupled the number of waivers it has granted, Reuters reports. Some of the refineries are run by Exxon Mobil and Chevron Corp.
Who else is glad this week's almost over? In the wake of 31 more small refiner exemptions, China news, and surprise USDA report, we’ve seen a potential $10.6 billion transfer of wealth from #ethanol industry and farmers to #BigOil. pic.twitter.com/a5yolQqfX8
— Renewable Fuels Association (@EthanolRFA) August 16, 2019
Iowa, a swing state that voted for Trump in 2016, is the leading corn producer for ethanol. Rural states were key to Trump’s election victory. But margins in some farm states were very thin, and farmers are losing patience with his trade war, despite an array of taxpayer handouts designed to cushion the blow of China’s decision to quit buying U.S. agricultural products.
The waivers are another sign of growing cracks between the administration and those Trump has referred to as “my farmers.” At a Minnesota Farmfest listening session earlier this month, Agriculture Secretary Sonny Perdue cracked a joke characterizing farmers as “whiners.”
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