News

FAPRI analysis highlights tradeoffs of expanded E15 policy

The director of the University of Missouri’s Food and Ag Policy Research Institute says an increase in E15 use would be positive for agriculture, but not a gamechanger.

Seth Meyer tells Brownfield it’s not an immediate fix for tight margins, and there’s a short-term tradeoff between corn and soybeans.

“You’ve got these mandates sitting out there, so the volume is really fixed. And what adding E15 does from this is it pushes out a little biodiesel as a little bit more ethanol comes in.”

That means reduced demand for biodiesel and downward pressure on the soybean markets, in the near-term.

According to a new FAPRI report, soybean prices would fall 9 to 22 cents per bushel through 2030, while corn prices would increase from 2 to 7 cents per bushel, if E15 became widely available.

Meyer says E15 has its benefits, too, including a stable market for corn ethanol, reducing farm safety net costs and it can help refiners meet mandates. He also says it adds more flexibility.

“Right now, we have trouble filling the 15 billion-gallon space that corn ethanol is allowed to fill. We can’t fill it with ethanol because of the blend wall (but) if you push the blend wall out with E15 this means you could fill the 15 billion gallons, and potentially more.”

Meyer says FAPRI has been getting lots of questions about E15 as Congress works on legislation that would allow for nationwide, year-round E15.