Policy Update: Proposed RINS Cap Guts the RFS
RINS are the currency on which the RFS operates, and today, President Trump again turned his sights on the RFS by attacking RINS. That attack came in the form of a cap on the price of Renewable Identification Numbers or RINS – which would significantly undermine the integrity of the RFS – lowering market prices for Missouri soybean farmers and raising feed costs for livestock producers, and ultimately costing Missouri jobs.
We need your help to remind President Trump and his staff of the importance of the RFS.
“Missouri has always been right up front on biodiesel, and we can’t sit back now and let the currency on which the RFS runs be devalued. Limiting the RFS with RINS caps is directly contrary to the commitments President Trump made the American Farmers and rural communities that elected him. The RFS works for Missouri and it works for agriculture.”
–Missouri Soybean Association President C. Brooks Hurst
Your Missouri Soybean Association is partnering with the American Soybean Association (ASA) and the National Biodiesel Board (NBB) to remind the President that RFS is working and capping RIN prices will undercut the RFS. You can email the President and his staff through NBB’s system by clicking here: http://p2a.co/45hHksf.
Biodiesel is a significant market for domestic soybean oil and analysis from the NBB and the World Agricultural Economic and Environmental Services (WAEES) shows that if caps are placed on RINs up to 300 million gallons in biomass-based diesel volumes would be lost each year as these volumes would no longer be utilized for compliance with the RFS conventional biofuels requirements.
The NBB and WAEES analysis showed that soybean producers would receive approximately 16 cents less per bushel thanks to reduced demand. That lower demand for soybean oil means livestock producers are expected to pay more for their soybean meal, amounting to roughly $185 million more in feed costs due to a cap on RINs.
As the second-largest biodiesel producer in the U.S., Missouri generates about 200 million gallons of biodiesel each year. That production supports more than 2,500 Missouri jobs directly. Including indirectly related jobs grows that number to 6,400. Soybean production and processing contributes 20,700 jobs to Missouri’s economy.
Want To Do More?
Beyond sending the President a message directly, we encourage you to use your Twitter accounts to Tweet at the President to gain attention over the weekend. Sample tweets are below.
- @RealDonaldTrump soybean farmers need you to keep your campaign promise and protect the #RFS by opposing RIN caps!
- RIN caps = #biodiesel demand destruction @ReadDonaldTrump protect the #RFS and oppose RIN caps.
- #Rural economies depend on demand for #soybean oil, and RIN caps will destroy biodiesel demand. @RealDonaldTrump, support rural America, oppose RIN caps.
Additional Background Information
In response to ongoing requests from anti-Renewable Fuel Standard (RFS) interests, President Trump and the Administration have held multiple meetings with stakeholders, including USDA and biodiesel companies, to hear perspectives and determine if any actions would be agreeable to both sides. Senator Ted Cruz (R-TX) has proposed placing a hard cap on the price of Renewable Identification Numbers (RINs) as a way to assist certain petroleum companies. The biofuels industry, including biodiesel and soybean interests, are opposed to the proposed cap on RIN prices as it would reduce biofuel demand and undermine the RFS. A RIN is a serial number assigned to a batch of biofuel for the purpose of tracking its production, use, and trading as required by the RFS. At Commodity Classic last week, USDA Secretary Sonny Perdue cited the importance of the RFS to agricultural markets, indicated his strong support for the RFS and pledged to continue working within the Administration to ensure that the program would not be diminished. While biodiesel is not being cited as a problem and not targeted directly, many of the proposals that have been discussed to revise the RFS would have an adverse impact on biodiesel demand. ASA will continue to be actively engaged with our biodiesel industry partners, USDA, and the White House to ensure U.S. biodiesel and soybean markets are not adversely impacted by any changes to the RFS. In turn, ASA will continue to push for extension of the biodiesel tax credit as a way to boost production for RFS volumes that benefit consumers and the fuel industry.
To learn more about these or other policy issues affecting Missouri soybean farmers, contact your Missouri soybean staff at (573) 635-3819 or through mosoy.org. You can also access important policy information through the American Soybean Association, online at soygrowers.com.