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Diesel export ban debate raises questions for agriculture

Some Republican lawmakers have called for a temporary ban on diesel exports and there are questions whether it would lower fuel costs for farmers and consumers.

Geoff Cooper, president and CEO of the Renewable Fuels Association, says RFA doesn’t have an official stance, but, “We have looked at a lot of the analysis that’s been generated in the last few weeks suggesting that banning diesel exports might help in the short-term with fuel prices, but longer term could have the opposite effect,” Cooper said.

Speaking during an NAFB webinar Wednesday, Cooper said uncertainty surrounding the proposal is creating concern across the ag industry.

“We’re just encouraging folks to very carefully evaluate the market implications and impacts of what a decision like that would actually have,” Cooper said.

Ag economist Gregg Ibendahl with Kansas State University says the fuel market needs to work itself out.

“I don’t really believe in the whole idea of us trying to restrict exports and that kind of stuff,” Ibendahl said. “Sure it may help a little bit in the short run, but I don’t think it’s going to be a good thing in the long run.”

Ibendahl tells Brownfield, “The only long-term solution to this is really to get the Strait figured out so that we can get diesel fuel flowing there, and then get Russia so they can get their refineries built back,” Ibendahl said. “Those are going to be the long-term solutions to getting prices down.”

U.S. Energy Secretary Chris Wright said this week that restricting diesel exports could drive gasoline and jet fuel prices higher. There have been reports that the Trump administration is considering a 90-day ban on diesel exports.