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Biofuels report highlights growth in demand benefits for ag economy

A new report conducted by S&P Global Energy explores how expanded biofuel production could help lift a struggling farm economy.

U.S. Farmers and Ranchers in Action CEO Kevin Burkum says, “Agriculture is at a crossroads.”

“There are some people who think where we are now is just before, it’s very similar to what happened in the 1980s when 300,000 US farms defaulted on their loan, it created a rural recession that lasted a generation,” he says.

S& P Global Energy’s Kevin Lindemer says efficiency gains in agriculture, energy, and technology have yet to peak, but demand is weakening.

“When you have agricultural surpluses, we have a choice,” he says. “We can rationalize capacity, which is what every commodity industry does, or if we have the opportunity to find new markets and create new markets, that is where we are headed.”

Iowa Senator Chuck Grassley says the report confirms biofuel markets need E15 access to expand.

“A robust biofuels market that will be enhanced by E15 would answer the prayers of farmers working their tails off to be profitable,” he says.

Senator Tina Smith of Minnesota says biofuels can help build a new path forward for agriculture.

“We are making headway here,” she says. “It is sometimes hard to see it, but reports like you are putting out here is just so important for kind of lifting us all out of the day-to-day and helping us see what we actually can accomplish.”

Commissioned by USFRA, the Fueling Agriculture: Biofuels as the Catalyst Report finds U.S. farmers have the potential to support a threefold expansion in biofuels by 2050 without additional land.

The report says without new demand markets, U.S. corn acreage could drop by more than 30 percent by 2050, a loss of nearly 30 million acres.