Lindsay Mitchell

May 11, 2018  |  Today's News |  Ethanol |  Legislation & Regulation

On Tuesday, May 8, 2018, President Trump, EPA Administrator Pruitt, USDA Secretary Sonny Perdue, Iowa Senators Grassley and Ernst, Texas Senator Cruz, and Pennsylvania Senator Toomey met to discuss the so-called RINs deal, a compromise that President Trump has been interested in brokering since Senator Cruz brought it up as a primary election issue late in 2017.


The May 8 meeting came sooner than expected as the understood outcome of a previous meeting called by President Trump was that he would revisit the issue in 90 days.


To summarize the meeting, RVP fix is agreed to and will move forward, and the RIN cap is off the table.  IL Corn supports both actions.


However, a third item is still undefined and is pending EPA Administrator Pruitt and Secretary Perdue working out details.  The group discussed reallocating RINs from exempted small refinery gallons to ethanol exports and/or reallocating the exempted RINs to other refineries not receiving a waiver.  Senators Ernst and Grassley did not agree to this without seeing additional details.  IL Corn supports the Iowa Senators.


As far as timing, that was also not specified. The sentiment was “sooner rather than later” but there were no specific details on timing of moving forward.


We see the agreement on RVP as positive, as well as having a RIN cap off the table. However, farmers are still left with a large amount of uncertainty as this process will continue.


RINs on export gallons would be damaging to farmers. We have had two straight years of record ethanol exports, which have been a bright spot for farmers and corn prices. The purpose of the RFS and the RIN system is to drive domestic consumption of renewable fuel. RINs on exports would be viewed as an unfair trade practice, opening farmers to more trade retaliation, at a time when farmers are already facing trade issues. This approach jeopardizes the one area of positive ethanol growth in the marketplace.


The gallons lost to the small refinery exemptions should be reallocated domestically, not to our exports – that action doesn’t get us those gallons back. EPA committed in October that the agency would not pursue regulations on export RINs.


IL Corn opposes RINs allocated to exported ethanol and we believe this would require a legislative change.


Read what the U.S. Grains Council has to say on this issue here.