After losing China, the largest export market, due to Trump’s trade war, American farmers are pinning their hopes on the government to increase the quota for biofuel blends to absorb the excess crops. Data from the United States Department of Agriculture shows that overseas sales of soybeans, corn and wheat in the next season will decline by 79% and 49% respectively compared with the average level of the past five years. Farmers’ representatives said that if the demand for biofuels is not increased, inventories will accumulate, further hitting the already weak agricultural economy.
Agricultural giants and biofuel organizations have called for a 60% increase in the 2026 quota for biodiesel to 5.25 billion gallons and maintaining ethanol production at 15 billion gallons to boost domestic demand. Although the oil industry partially supports the proposal, the refiners’ group believes that the demand for gasoline is insufficient and the supply of raw materials is unstable. Biofuel producers have warned that too low quotas have led to factory shutdowns, hindered emission reduction targets and harmed the interests of farmers. The Environmental Protection Agency said it has submitted a proposal to the White House, emphasizing that the plan is in line with Trump’s energy independence and agricultural market strategy.
Although the Trump administration is considering a new round of agricultural assistance, farmers prefer to solve their predicament through the market rather than subsidies. Orders in key markets such as Mexico and Japan are still far below the levels of previous years, and China’s shift to purchasing from Brazil has intensified the pressure. The minister of agriculture hinted at the possibility of providing assistance, but farmers emphasized that developing domestic uses is the sustainable way out. As the midterm elections approach, the performance of the agricultural economy may affect key votes.
Related Topic:
