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The American Soybean Association (ASA) is raising the alarm over requests from several U.S. states with significant petroleum interests that are petitioning for a rollback of Renewable Fuel Standard (RFS) volumes. The association warns that these requests, if granted, would strike a major blow to domestic U.S. soybean markets and the broader rural economy.
Several governors have petitioned the Environmental Protection Agency (EPA) to waive all 2027 RFS compliance for petroleum refiners in their states, arguing that the move would lower fuel prices. However, the ASA points out that national average costs of biofuel blends are actually lower than conventional petroleum fuels. At least one petition falsely claimed that a waiver would support agriculture and poultry producers, despite the clear economic benefits that robust renewable fuel demand provides to both industries and rural communities.
While American farmers are struggling to keep their operations viable amid rising costs, U.S. oil and gas companies have posted record profits of $160 billion since April—an increase of over 175% compared to last year. The ASA asserts that undercutting the RFS by waiving compliance would result in a massive giveaway to refineries making record gains, while American agriculture would be left to bear the economic consequences.
Currently, the RFS supports domestic energy production while simultaneously boosting the agricultural sector. As a result of existing volume obligations, domestic demand for U.S. soybeans has surged, and biofuel production is booming. Soybean processors are currently investing billions of dollars within the United States to increase capacity through plant expansions and new construction. This growth creates jobs and improves local on-farm basis for farmers. Furthermore, as the demand for soybean oil increases availability, it lowers the cost of soybean meal used by livestock producers, translating into lower prices for consumers on products like meat, milk, and eggs.
Biomass-based diesel serves as a critical and growing domestic market for soybean oil, supporting crop prices and rural economic activity. Consequently, the ASA is urging the EPA to stand with U.S. farmers and the rural economy by denying these state petitions and maintaining the future integrity of the RFS.
Source: Oklahoma Farm Report