Biofuels were the reason for Gov. Tim Walz’s visit to Plato Monday. He was at the farm of Brian Thalmann, president of the Minnesota Corn Growers Association, where he signed an executive order creating a 15-member council to advise him and his cabinet on policy proposals geared toward boosting the reeling biofuel industry in Minnesota.
“We’ve worked together for the better part of a decade and a half on this issue of clean American energy,” Walz said. “The idea of value added in our communities. Innovation, entrepreneurship and opportunities for new markets.”
The council will include representatives from the agriculture, biofuels and transportation industries, as well as from environmental and conservation groups. One of the council’s jobs will be to create a report by Nov. 2020 detailing the best ways to expand the biofuels industry and reducing greenhouse gas emissions in the state.
The U.S. ethanol industry is struggling with factors such as the trade war with China and adverse federal regulator action, such as waivers on ethanol use by small oil refineries. Ethanol prices are the lowest they’ve been in years.
Walz used Corn Plus, a farmer-owned cooperative in Winnebago that recently closed, as an example of the affect waivers are having on the industry. That refinery cited tight profit margins caused by refinery waivers as the reason for closing.
“The use of these waivers to depress this industry is hurting jobs, hurting local communities, hurting innovation and hurting our energy independence,” he said. “So our role here today is to create this 15-member panel that will be a diverse group of folks, that will have honest conversations on how we can continue to be a leader and push back to make sure Minnesota is finding paths forward.”
Minnesota is the fourth-largest ethanol-producing state in the U.S. with 18 operating plants. The state is also a national leader in ethanol consumption.
“There will be industries and folks who will continue to try and make it seem that this isn’t possible, that it doesn’t work,” Walz said. “You will hear how it takes more energy than you get out of it, or there’s more carbon to put into it. That’s an absolute fallacy. It’s absolutely untrue, and the science supports it.”
Earlier this month, Walz partnered with South Dakota Gov. Kristi Noem to draft a letter to President Donald Trump expressing their frustrations with the waivers and imploring them to support local farmers and biofuel producers.
“This is not a partisan issue. This is truly the one that brings us together about growth,” Walz said. “I just want to be clear, getting rid of the waivers isn’t really enough. The damage is pretty great. I want to knock on wood and hope we heard good news on the tariffs, but I have to remind people that’s not even getting us back to where we started.”
He remarked that even if all the tariffs were lifted and the trade war ended, production would have a long way to go before it reached levels prior to the trade war. Heartland Corn Products CEO Gary Anderson said agricultural profitability depends on a supply-and-demand balance.
“Production agriculture and the ethanol industry are experiencing significant challenges from demand disruptions due to trade policy,” Anderson said. “While we continue to encourage the president to direct the EPA to involve the laws as they were written and create a favorable trade environment, today we are excited to have Gov. Walz support looking for creative ways in our state to create value for all stakeholders.”