EPA provides welcome news to Iowa corn growers
Denial of waivers is expected to increase demand for the crop
In a year marked by drought and a derecho, Iowa’s farmers, especially corn growers, recently got some good news from what could be considered an unlikely source.
The U.S. Environmental Protection Agency has reversed course and denied a number of waivers that would allow oil companies to use less ethanol. The result of that decision is expected to be another 1 billion bushels of corn being consumed, adding to the bottom line of Iowa’s corn growers.
Those waivers have been part of the rules related to the Renewable Fuels Standard for some time. They were intended for refiners who were experiencing situations that genuinely prevented them from meeting the requirements of the standard. But in recent years, it appeared that waivers were granted to any company that asked for one.
Commodities groups and the renewable fuels industry have been pushing back against that trend for months. Recently, the EPA reversed course and denied a bunch of waivers.
The move, coming as it did shortly before an election, generated some skepticism. We believe it is more constructive to focus on the positive aspect of this development, which will create more demand for the corn grown by Iowa’s farmers.
Hopefully, the decision to deny the waivers will set a precedent which will make it harder for the EPA to grant them in the future.
The EPA’s move will not fix the overriding problem facing the ethanol industry, which is depressed demand for fuel because fewer people are traveling during the COVID-19 pandemic.
Even so, the EPA decision is welcome news.