EPA Grants RFS Waivers on Eve of Inauguration

In the Trump Administration’s final hours, the EPA granted two small refinery exemptions to the Renewable Fuels Standard (RFS) and appears to have reversed a previous denial. EPA does not release information on who has received the waivers, but the Renewable Fuels Association (RFA) notes the two waivers granted for 2019 amount to a loss of 150 million gallons of biofuel demand. The RFA also notes that the EPA website indicates a previously denied 2018 waiver request was reversed, resulting in an additional loss of 110 million gallons of biofuel demand. The RFA immediately threatened to challenge the waivers in court. “This midnight-hour attempt by the Trump administration to damage the Renewable Fuel Standard and sabotage the ethanol industry’s recovery from the COVID pandemic simply cannot be allowed to prevail,” RFA CEO Geoff Cooper said in a statement. “With just hours remaining in his shameful term as EPA Administrator, Andrew Wheeler couldn’t stop himself from doling out a few more Clean Air Act compliance exemptions to his well-connected friends. But the fact remains that today’s action by EPA is completely without legal merit. It flouts both the statute and recent court decisions that clearly limit EPA’s authority and ability to grant these exemptions. And while this action comes as one last sucker punch from the Trump administration, we are confident it will be a hollow victory for the politically connected oil companies receiving today’s waivers, as the new Biden Administration will most certainly act quickly to restore the volumes erased by these waivers.” Biofuel organization Growth Energy notes these latest waivers bring the total number of Small Refinery Exemptions (SREs) granted by the Trump Administration to 88, representing 4.3 billion gallons of biofuel demand. “Farm families and biofuel workers across the country have worked tirelessly to make a living over the past few months despite a global pandemic. And yet, the Trump Administration’s SRE abuse has piled on to the uncertainty and difficulty that rural Americans are facing every day,” added Growth Energy CEO Emily Skor in a press release.  “Given President-elect Biden’s commitments on the campaign trail, we‘re confident his incoming team will swiftly work to reverse the damage these oil handouts have done to rural America by this midnight maneuvering.” Outgoing EPA Administrator Andrew Wheeler had earlier indicated he would wait until the Supreme Court had reviewed a suit over the waivers before making a determination on the outstanding 2019 and 2020 waiver requests.  The court is set to review a 10th Circuit ruling that the waivers were meant to be extension, so refiners could not be granted a waiver to the blending requirements of the RFS if they had not been granted a waiver every year since it was implemented in 2010. “It shouldn’t be a surprise to those who have been paying attention for the last four years that this EPA would undermine corn farmers and the ethanol market on its way out the door. There is no reason for the EPA to take this action now, especially with the Supreme Court set to consider the Tenth Circuit ruling in the new term,” said National Corn Growers Association President John Linder. “Corn farmers need an EPA that will follow the law as written and intended by Congress. NCGA looks forward to working with the Biden Administration to rectify the harm caused by this EPA’s abuse of small refinery exemptions and restore the integrity of the Renewable Fuel Standard.” The EPA website indicates there are still 30 outstanding SRE applications for 2019 and 15 pending applications for 2020.

USDA Cut Ethanol Demand; USDA Chief Economist Explains Why

Ethanol demand continues to be a question in the new year. As COVID-19 cases continue to rise in the country, some states are still seeing restrictions, which is impacting the number of people on the road. At the same time, ethanol stocks rose to an 8-month high earlier this month. Just how much of a reduction ethanol demand will see in 2021 is still unknown. In the latest World Agricultural Supply and Demand Estimates (WASDE) report, USDA showed corn used for ethanol would be lower this year. The agency said it was based on data through November from the Grain Crushings report, as well as weekly ethanol production data from the Energy Information Administration (EIA). The new USDA Chief Economist Seth Meyer was a guest on U.S. Farm Report and explained USDA’s decision to cut ethanol demand.   “We're looking at corn grind, and we're looking at an ethanol production from EIA, and feel like that number that we have in there [WASDE] is pretty in line with what we're seeing with regard to both the Energy Outlook and where we've seen with grind,” says Meyer. “Folks bring up an issue of how demand and the balance sheet were changed. Well, you're provided with essentially 400 million bushels less supply, and you know, that will ration demand.” Meyer says based on lower supply and the probability of higher prices eating into demand, USDA made other key adjustments in the balance sheet, including 100 million bushels reduction to exports. “You may have to make some adjustments to exports, you take a little bit of it out of stocks, and then you say, what does ethanol look like in regard to corn grind?It may be somewhat less sensitive in terms of its overall demand and other things given underlying policy,” adds Meyer. “So, you're looking at a position coming out of this, where you've got prices back to rationing demand a little bit. Each one of those lines of demand is carefully thought out, in terms of where we're at with that 400-million-bushel smaller supply from the WASDE.”        

USDA offers web seminar on proposed rule on organic enforcement

A U.S. Department of Agriculture web seminar will provide an overview of proposed changes to enforcement regulations of organic agriculture. The web seminar is set for 1 p.m. Eastern on July 8 and will review the USDA’s National Organic Program’s Strengthening Organic Enforcement proposed rule, according to a notice from the agency. The proposed rule will be published soon in the Federal Register, according to the agency. Registration is free for the web seminar. A 60-day comment period will begin when the proposed rule is published in the Federal Register, according to the USDA.

EPA Receives 52 New Petitions for Retroactive Biofuel Blending Waivers

The U.S. Environmental Protection Agency has received 52 new petitions for retroactive biofuel blending waivers that, if granted, would circumvent a court ruling this year that nullified a number of those waivers, EPA data showed on Thursday. The new pending applications for blending exemptions are for compliance years 2011 through 2018. The waivers exempt oil refiners from U.S. laws that require they blend billions of gallons of biofuels into their fuel pool. In January, the Denver-based 10th U.S. Circuit Court of Appeals ruled that waivers granted to small refineries after 2010 had to take the form of an "extension." The decision called into question the future of the EPA's exemption program because most of the recipients of waivers in recent years have not continuously received them each year since 2010. The waivers have been a battleground for the oil and corn lobbies, both major constituencies of President Donald Trump. Biofuel advocates say the waivers hurt demand for corn-based ethanol, while the oil industry refutes that claim and says the obligations are too pricey. Under the U.S. Renewable Fuel Standard, oil refiners must blend billions of gallons of biofuels into their fuel, or buy credits from those that do. Small refiners that prove the rules would financially harm them can apply for exemptions. The EPA is in charge of granting exemptions after the Department of Energy reviews applications. The Energy Department's Mark Menezes said last month that the EPA had asked the department to review waiver requests from refiners covering past years, but the agency had not reported the petitions on its dashboard until Thursday.

USDA releases plan on $2.1 billion in COVID-19 payments to growers

With up to $2.1 billion for specialty crop producers at stake, the U.S. Department of Agriculture has provided the first details of the Coronavirus Farm Assistance Program direct payment plan. The direct payments are the second part of USDA’s coronavirus relief. The first, the Farmers to Families Food Box program, announced $1.2 billion in contracts May 8 for food box deliveries of fresh produce, dairy, and pre-cooked meat. Funding for produce box sourcing and distribution was earlier estimated at $100 million per month for six months.

Direct payment plan

Under the direct payment program, payments will be based on losses where prices and market supply chains were disrupted. The compensation will help growers deal with lost demand and short-term oversupply during the 2020 marketing year as a result of COVID-19, according to a news release from USDA. “These payments will help keep farmers afloat while market demand returns as our nation reopens and recovers,” Agriculture Secretary Sonny Perdue said in the release. “America’s farmers are resilient and will get through this challenge just like they always do with faith, hard work, and determination.” Producers that fall into one of the following categories may be eligible to receive direct payments: Sales with a price loss of 5% or more between January 15 and April 15, 2020. Almonds, artichokes, beans, broccoli, cabbage, carrots, cauliflower, sweet corn, cucumbers, eggplant, lemons, iceberg and romaine lettuce, dry onions, peaches, pears, pecans, bell and other types of peppers, rhubarb, spinach, squash, strawberries and tomatoes are eligible; Shipments that left the farm by April 15 and spoiled due to no market or for which no payment was received. All specialty crops are eligible for this payment; and Shipments that have not left farm or mature crops that remained unharvested by April 15. All specialty crops are eligible for this payment. Beginning on May 26, growers of eligible commodities may apply for assistance through their local USDA Farm Service Agency Service Center, according to the release. Application forms and additional information is at The USDA said there is a payment limitation of $250,000 per person or entity for all commodities combined, although the USDA said corporations, limited liability companies or limited partnerships may qualify for additional payments if members actively provide personal labor or personal management for the farming operation. Producers will also have to certify they meet the Adjusted Gross Income limitation of $900,000 unless at least 75% or more of their income is derived from farming, ranching or forestry-related activities, according to the USDA, and producers must also be in compliance with Highly Erodible Land and Wetland Conservation provisions. The USDA encouraged specialty crop producers to complete applications before May 26.

Program details

The direct payment funding comes from $9.5 billion in the Coronavirus Aid, Relief and Economic Stability (CARES) Act and $6.5 billion from the Commodity Credit Corporation Charter Act to compensate producers from market disruptions. Under the direct payment program, producers will receive 80% of their maximum total payment upon approval of the application. The remaining portion of the payment, not to exceed the payment limit, will be paid at a later date as funds remain available. The USDA first announced the $16 billion program for all farmers and ranchers in mid-April: The direct payments are going to:
  • $9.6 billion for the livestock industry ($5.1 billion for cattle, $2.9 billion for dairy and $1.6 billion for hogs);
  • $3.9 billion for row crop producers;
  • $2.1 billion for specialty crops producers; and
  • $500 million for other crops Direct Assistance for Farmers and Ranchers.

Produce Industry reaction

The following associations issued statements on the USDA’s direct payment plan. Florida Fruit & Vegetable Association President Mike Joyner: “We appreciate the administration’s efforts to help agriculture overcome many of the challenges we have faced during this pandemic. Florida specialty crop producers experienced devastating losses from the shutdown of the foodservice supply chain and slowdown at retail – losses far greater than the direct payment limits announced today will cover. We will continue to work with Congress and the administration to secure additional relief for hard-hit Florida growers of fresh fruits and vegetables.” National Potato Council CEO Kam Quarles: “Given the scope of this crisis, we knew the initial funding would be insufficient to meet the need of family farms. Based upon the limited resources announced today under this direct payment program, the potato industry is strongly urging Congress to act rapidly to provide more resources and flexibility to fill this huge gap and maintain producers’ livelihoods.” United Fresh Produce Association President and CEO Tom Stenzel: “We applaud the announcement of a direct payment program for fruit and vegetable growers, which can also help relieve some of the debts owed by distributors who lost the ability to pay when the foodservice sector was shut down. Combined with the Farmers to Families produce box program, these are steps in the right direction. But we still need to work closely with Congress to provide additional needed support to agriculture in the next round of legislation on Capitol Hill. It’s essential that administration and Congress focus on programs that target resources for growers, grower-shippers and others in the produce distribution supply chain that have had direct job losses and immediate financial impact from government mandated closures.” Western Growers President and CEO Dave Puglia: “The administration is doing what it can to help as many farmers as possible from a limited source of relief funds. The tough part of this is that even with the increased cap on relief payments to individual farmers, the actual losses are far greater for many. By way of example, the average sized lettuce farm in the West is 250 acres and requires about $5,000 per acre to grow the crop. The relief payment cap means the farmer who lost the entire crop when the food service industry was closed will have no relief for all but 50 acres of that loss. “We appreciate all the administration has already done, especially on regulatory and administrative challenges, to keep our industry operating through the crisis. I urge the president and (Agriculture Secretary Sonny Perdue) to closely monitor the full scope of economic damage done to fresh produce growers and other farmers and ranchers, and to work with Congress to close the gap in future COVID-19 relief efforts.”  

House passes $500 billion Coronavirus Bill and oversight panel

The U.S. House of Representatives overwhelmingly approved a $484 billion coronavirus relief bill on Thursday, funding small businesses and hospitals and pushing the total spending response to the crisis to an unprecedented near $3 trillion.
The measure passed the Democratic-led House by a vote of 388-5, with one member voting present. House members were meeting for the first time in weeks because of the coronavirus pandemic. Lawmakers, many wearing masks, approved the bill during an extended period of voting intended to allow them to remain at a distance from one another in line with public health recommendations. The House action sent the latest of four relief bills to the White House, where Republican President Donald Trump has promised to sign it quickly into law. The Republican-led Senate had passed the legislation on a voice vote on Tuesday. But threats of opposition by some members of both parties prompted congressional leaders to call the full chamber back to Washington for the House vote despite state stay-at-home orders meant to control the spread of the virus. The House also approved a select committee, with subpoena power, to probe the U.S. response to the coronavirus. It will have broad powers to investigate how federal dollars are being spent, U.S. preparedness and Trump administration deliberations. Democratic House Speaker Nancy Pelosi said the panel was essential to ensure funds go to those who need them and to prevent scams. Republicans said the committee was not needed, citing existing oversight bodies, and called the panel's creation another expensive Democratic slap at Trump. The committee was approved on a vote of 212-182, along party lines.
The bill reserves $60 billion of the Paycheck Protection Program funding for small lenders and minorities, clarifies that farmers are eligible for the Economic Injury Disaster Loan program and provides funding specifically for rural hospitals. A handful of lawmakers opposed the legislation, including Democrat Alexandria Ocasio-Cortez, who represents a severely affected area of New York and believes Congress should do even more - and Republican Thomas Massie, known as "Mr. No" for his frequent opposition to spending bills. "This is really a very, very, very sad day. We come to the floor with nearly 50,000 dead, a huge number of people, and the uncertainty of it all," Pelosi said during debate on the bill. Congress passed the last coronavirus relief measure, worth more than $2 trillion, in March, also with overwhelming support from both parties. It was the largest such funding bill ever passed. TROUBLE AHEAD The next step will be harder. The two parties have set the stage for a fight over additional funding for state and local governments reeling from the impact of lost revenue after Republicans refused to include such funds in the current relief bill. Trump has said he supports more funding for states, and has promised to back it in future legislation. Congressional Republicans have resisted. Senate Majority Leader Mitch McConnell suggested in a radio interview on Wednesday that states could go bankrupt, but said later he did not want states to use federal funds for anything unrelated to the coronavirus. Democrats castigated McConnell for the remark. "Leader McConnell said to our cities and states, to our cops and firemen and teachers, he told them to drop dead," said Representative Max Rose, who represents a district of New York City. Thursday's voting took place under safety protocols that considerably dragged out proceedings. Lawmakers came to the House in alphabetical order in small groups and were told to stand in line, 6 feet (1.8 m) apart, before entering the chamber. There was also a half-hour break scheduled to clean the chamber between the two votes. But more than a dozen cleaners descended on the chamber with cloths and spray bottles and wiped it down in less than 10 minutes. Echoing Trump, many Republicans also want the country - including Congress - to reopen quickly. Republican Representative Ralph Norman of South Carolina said lawmakers should "get our businesses to open the doors and do what Americans have always been allowed to do, which is go to work." House Republican leader Kevin McCarthy said the latest aid package should have been passed at least two weeks ago after the Trump administration requested it. "Some people unfortunately got laid off because of this delay," McCarthy said. Democrats rejected the charge, saying lawmakers had improved on Trump's request by adding billions of dollars more for small businesses, hospitals and coronavirus testing.

Detailed China Update from Chief Ag Negotiator

It's lonely being at the U.S. Trade Representative’s office lately, especially the fourth floor where top agriculture negotiator Gregg Doud said he's the only one on that portion of the building. The loneliness is not because he's like the Maytag repairman with nothing to do! Those quiet confines were an ideal setting to catch up with Doud on key trade issues, including an update on Phase 1 of the U.S./China trade agreement signed Jan. 15, 2020 and taking effect Feb. 14. First some background on China's purchases of U.S. farm products. China imported $5 billion worth of U.S. ag goods in the first quarter of 2020, according to Chinese data, including $3.1 billion of soybeans and $430 million of pork. China’s total U.S. ag purchases increased 110% in the first three months of this year. This week's USDA Weekly Export Sales report showed China continued making some purchases of U.S. ag commodities the week ended April 9, including net purchases of 165,000 tonnes of U.S. wheat (50,000 tonnes for 2019-20; 110,000 tonnes for 2020-21), net purchases of 137,750 tonnes of sorghum, 5,869 tonnes of soybeans, 1,489 tonnes of U.S. beef and 16,402 tonnes of pork (even after cancelling 6,072 tonnes of prior purchases). While China bought cotton this week, cancellations of prior buys meant a net reduction of 81,999 running bales of upland cotton to China.  The obvious question to ask Doud was whether or not China would live up to its Phase 1 commitment of purchases of U.S. farm products. “You know, the Phase 1 agreement with China and agriculture was just not about purchases, it was also about fixing a very significant number of unwarranted trade barriers,” Doud said, detailing there were “something like 57 different things that we agreed between the U.S. and China to remedy and fix.” Timeline of ag-related accords. Some of those ag-related agreements took place when the agreement took effect Feb. 14. Some of those were within five days, 10 days, 20 working days, one month, two months. “Here we are now at kind of the two-month point,” Doud said. “And so far, we're doing very, very well. We're in constant contact with China almost every single day... back and forth... making sure we are getting things fixed. And, you know, we're not perfect. There are still a few things that we're trying to sort out. But I will tell you, every single day, despite what's going on in China… we see the difficulty they've been going through for most of this year... despite all of that, they're working very hard. Our folks at USDA, FDA, etc. are working very hard to get all of this implemented.”

Senate Rescue Package Includes $14 Billion to Replenish CCC

Congressional sources confirm that the Senate rescue package includes $14 billion to replenish USDA’s Commodity Credit Corporation (CCC) and provides $9.5 billion for ag producers impacted by Covid-19, including livestock and specialty crops (fruit, veggies and nuts).
The CCC currently has about $9 billion to use. So, this brings CCC borrowing authority to $32.5 billion — not the $50 billion asked for and cited previously by Sen. John Hoeven (R-N.D.), but above the $30 billion normally available. However, the $9.5 billion “is a different pot of money,” one source said.

First Syngenta MIR162 Payments to be Mailed

Farmers wondering where the money from the MIR162, AgriSure Viptera, settlement went will soon have their questions answered in the form of a check. The first payments to class action members will be in the mail soon. For many farmers, their total payments for the settlement could be more than $5,000, according to a recent press release from plaintiff lawyers. “This brings meaningful relief to a long and hard-fought battle. We are gratified that the hundreds of thousands of class members will be compensated for their losses, and we hope these payments help the many farmers who are hurting economically,” said the settlement class counsel, including Patrick Stueve, Dan Gustafson and Chris Seeger.   Starting March 20, expect interim payment checks to include:
  • 65% of producer and landlord settlement amount
  • 50% of grain handling and ethanol production facility settlement amount
The rest of the settlement is expected to be delivered this fall, when all claims are processed. Processing the settlement and getting checks sent is a product of discussions between plaintiff attorneys and judges. After the settlement was decided, Syngenta had no part in discussing distribution strategies. To receive payments, farmers or processors needed to submit certain forms. These forms include payment documents, such as W-9 forms. You will not receive a payment until a W-9 form is received. Payments are part of a larger $1.51 billion settlement related to Syngenta’s marketing Viptera and Duracade-traited corn seed. Certain corn shipments to China were rejected in 2013, as a result of the presence of the then-unapproved traits. Plaintiff lawyers said this lead to a decline in corn market prices. This is believed to be the largest ag settlement in U.S. history.

COVID-19: 5 Things Your Farm Should Do Now

As novel coronavirus (COVID-19) makes its way into the U.S., are you prepared for some of the more likely scenarios that could impact your operation? “Coronaviruses are not new and are responsible for approximately 20% of common colds already, however due to this being a novel coronavirus, the population is very susceptible and transmission will therefore be widespread in the absence of a vaccine,” says Beau Peterson, general manager and director of research at Carthage Veterinary Service (CVS) in Carthage, Ill. “The biggest impact to us and our business will likely be measures put in place to slow or stop the spread of the virus in the U.S.” Being prepared during a time like this is critical. CVS says their veterinary clinic will stay open one way or another. “Testing for COVID19 in the U.S. is just now starting to ramp up. When you consider the number of cases of community transmission already identified, we feel it is highly likely that the virus is much more widespread than what is currently being reported,” Peterson says.  

1.    Ensure people can work.

“One of the most impactful and likely scenarios we see playing out is a closure of schools and daycares in the communities where our business and our clients business operate,” he says. “This would put an incredible strain on families with children who would have to find alternative care options.” CVS is preparing for multiple scenarios to help their employees continue to work despite potential school and daycare closures. •    Work from home: Find solutions to allow office employees to work remotely if needed. Make sure adequate laptops are available, remote connections are accessible for home computers and systems that aren’t normally used remotely are configured for it. •    Creative childcare options: Help employees secure safe alternative care for their children if they have no other options. For example, CVS has some buildings that could be used to allow the parents who can’t work from home to work here and watch their children. “We are a community and we will take a community-based approach to this to help each other if the need arises,” Peterson adds.

2.    Prepare for supply chain disruptions.

Although disruptions haven’t occurred yet, many producers rely on China for some of the raw ingredients and finished goods used on farms. “Shipping disruptions have occurred in China already so there is a potential hole coming, and if port activity is impacted in the U.S., specifically the West Coast where a lot of COVID19 has been identified already, those disruptions could become significant,” Peterson says.  

3.    Monitor upcoming travel.

Carefully consider upcoming meetings that employees are scheduled to attend and make decisions about participation as necessary. In the past week, many international and domestic meetings have been canceled, postponed or moved to a web-based venue.

4.    Plan for interruptions to daily workflow.

Discuss and develop contingency plans for additional needs that would interrupt your daily workflow. This could include delivery of boar semen, shipment of diagnostic samples, product movement from warehouse locations, etc. In a letter to U.S. government officials on Tuesday, the National Pork Producers Council (NPPC) asked the administration to develop support plans for hog farmers if labor-related bottlenecks in the supply chain prevent hogs from being marketed. "The specter of market-ready hogs with nowhere to go is a nightmare for every pork producer in the nation. It would result in severe economic fallout in rural communities and a major animal welfare challenge,” said NPPC President Howard "A.V." Roth, a hog farmer from Wauzeka, Wis.

5.    Protect yourself.

Use common sense and remain calm. Do what you can to protect yourself and stay healthy –the same things you do every year during flu season, Peterson advises. Remind your employees to: •    Wash their hands frequently. •    Disinfect surfaces frequently. •    Stay home if sick and to be fever-free for 24 hours before returning to work. “The most important thing we can all do is stay informed and have a plan,” Peterson adds. “The producers we serve can’t take time off from caring for their animals, and we are committed to having plans in place that allow us to continue to support them.”