Global biofuels producer POET has announced its intention to idle production at its bioprocessing facility in Cloverdale, Indiana in the US, due to the latest round of small refinery exemptions (SREs) granted to oil companies by the US Environmental Protection Agency (EPA) under the Renewable Fuel Standard (RFS).
The plant will be idled over a period of several weeks, after which the facility will cease the processing of over 30 million bushels of corn annually, with hundreds of local jobs expected to be affected.
The company added that it had reduced production at half of its biorefineries, with the largest reductions taking place in Iowa and Ohio. Jobs will be consolidated across its 28 biorefineries, with corn processing dropping by an additional 100 million bushels across the states of Iowa, Ohio, Michigan, Indiana, Minnesota, South Dakota and Missouri.
“The Renewable Fuel Standard was designed to increase the use of clean, renewable biofuels and generate grain demand for farmers,” said Jeff Broin, chairman and CEO of POET. “Our industry invested billions of dollars based on the belief that oil could not restrict access to the market and EPA would stand behind the intent of the Renewable Fuel Standard. Unfortunately, the oil industry is manipulating the EPA and is now using the RFS to destroy demand for biofuels, reducing the price of commodities and gutting rural economies in the process.”
EPA’s mismanagement of SREs has placed an artificial cap on domestic demand for ethanol, according to POET. The agency has so far cut demand for biofuels by 4 billion gallons and reduced demand for corn by 1.4 billion bushels, impacting corn growers and biofuel producers across the US.
“POET made strategic decisions to support President Trump’s goal of boosting the farm economy,” added Jeff Lautt, president and COO of POET. “However, these goals are contradicted by bailouts to oil companies. The result is pain for Midwest farmers and the reduction of hundreds of jobs and hundreds of millions of dollars of economic activity across Indiana.”
Broin added: “My long-term fear isn’t for the biofuels industry, it’s for rural America. POET can continue to produce ethanol with cheap grain, but we don’t want to lose our family farmers. The EPA has robbed rural America, and it’s time for farmers across the Heartland to fight for their future.”
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