Major Soybean Processer Opposes EPA-Proposed Biodiesel Reduction

Ag Processing Inc. (AGP), a major Omaha-based soybean processing cooperative, has publicly stated its opposition to an Environmental Protection Agency (EPA) proposal that would reduce the amount of biodiesel production required under the Renewable Fuel Standard (RFS). The RFS requires that transportation fuels in the United States must contain a minimum amount of renewable fuels and it calls for increased yearly production level targets. However, a recent EPA proposal could cut production by 315 million gallons in 2018 and another 1 billion gallons in 2019.

Senior management at AGP has expressed its opposition to the proposal, citing a misconception of production capacity in the United States and the needs for rural economic growth. Cal Meyer, Chief Operating Officer at AGP, noted that EPA’s internal figures cite US production capacity as beyond 4.2 billion gallons yet there is a “mistaken belief” that processors would not be able to meet a 2.1 billion gallon production target. He stated, “The proposed reductions are unnecessary and will cause significant economic harm. Reducing the biodiesel requirements would lower the price of soybeans, jeopardize many of the jobs associated with biodiesel production, and negatively impact the domestic soybean processing and livestock industries.”

Keith Spackler, AGP Chief Executive Officer, spoke to the larger issues that the proposal could potentially affect. “We believe the RFS is one of the most important pro-growth policies affecting agriculture, as it boosts farm income, creates rural jobs, and generates new demand for our commodities. We oppose this proposal and believe it will have a negative impact on the U.S. biodiesel industry and rural communities throughout the country.” Spackler also expressed that AGP is encouraging policymakers and its membership not to support the proposal.