The agriculture industry is sounding the alarm over any potential EPA delays in finishing biofuel-blending rules this year, arguing that a lag would further hurt financially strapped soybean farmers.
“If it slips into next year, we essentially lose another quarter of demand as there just isn’t forward business being booked due to uncertainty,” National Oilseed Processors Association President and Chief Executive Officer Devin Mogler said.
Missed biofuel policy deadlines are nothing new. Both Republican and Democratic administrations are guilty of doing so under the Renewable Fuel Standard, which authorizes EPA to set national yearly mandates requiring a minimum volume of biofuel be blended into petroleum-based gasoline and diesel.
This year, the stakes are especially high for both agriculture and fuel refiners. On the farming side, which heavily relies on biofuels like soy diesel and corn ethanol to help fill crop demand, soybean growers are struggling as Chinese purchases have dried up amid President Donald Trump’s tariff war with the world’s top importer. Crop producers are forecast to see a third straight year of income declines.
Devin Mogler (NOPA photo)The trade woes come on the heels of a recent surge in U.S. imports of Chinese used cooking oil (UCO), a valuable feedstock for making biomass-based diesel. Soybean farmers argued that the flood of UCO undercut demand for home-grown biofuel ingredients that domestic biofuel policy is meant to encourage.
After outcry from soy growers, crushers and farm-state lawmakers, EPA last year proposed 2026-27 blending rules, or renewable volume obligations (RVOs), that reduces by 50% the value of biofuel credits, known as RINs, generated to track RFS compliance for fuels made with ingredients outside of the United States.
The EPA's RIN proposal is now the focus of heavy lobbying by farm groups and agribusiness companies that want to see it preserved in a final rule issued by year’s end. RINs are tradable and the main economic incentive for adding biofuels into the national U.S. fuel supply.
St. Louis-based Bunge Global, a major soybean shipper and crusher, said it's pushing for full value RINs for fuels made with domestic feedstocks and 50% for ones produced with foreign materials.
"Obviously, that's good for the American farmer," Bunge Chief Financial Officer John Neppl told analysts on Wednesday. "We're doing our best to encourage that in D.C. and hoping it gets implemented beginning in early 2026."
Meanwhile, fuelmakers are pushing back on the proposal and balking at what they view as a raft of recent biofuel policies they say put them at a competitive disadvantage. In protest, the powerful American Petroleum Institute recently withdrew support from legislation that would allow higher blends of ethanol to be sold year round across the country.
API and other fuel groups say the “half RIN” idea will drive up costs, particularly if coupled with reallocation of so-called small refinery exemption volumes (SREs), a thorny regulatory topic that spurred tense standoffs between Big Oil and agriculture in the second half of Trump’s first term.
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The RIN reduction “would create an additional burden for obligated parties,” API wrote in a letter to EPA Administrator Lee Zeldin on Friday.
Court asked to put heat on EPA
With less than two months from the new year, nervousness is taking hold that the final RVOs for 2026-27 could be delayed, possibly due to the partial government shutdown. The Trump administration proposal would boost overall biofuel volumes, most notably for biomass-based diesel, welcome news for soy farmers. EPA employees so far are still working on the rules amid the shutdown.
"It's still very much possible for EPA to get the RVO finalized and published before the end of the calendar year, and it is imperative that they do this to bring some certainty to the market for the first quarter of 2026," Mogler said.
Clean Fuels and Growth Energy last week asked the U.S. Court of Appeals for the D.C. Circuit to order EPA to issue the rule by Dec. 31. The groups noted that under federal law, the agency should have issued the final rule by Nov. 1, 2024, under the former Biden administration.
"EPA admits it has violated its statutory duty to issue the standards and has offered only the equivocal statement that it 'expects it will finalize the rule this winter 2025-2026,'" the filing said. A delay "threatens irreparable injury to the renewable-fuels industry and to the entire nation."
Representatives from EPA didn't immediately respond to Agri-Pulse's request for comment.
Meanwhile, if the shutdown goes beyond the end of November, there may simply be too little time for the administration to get the final RVOs out the door. Further, the closer it gets to 2026, the "less optimal it is for the whole industry to go forth with this 50% RIN proposal," Bloomberg Intelligence biofuel analyst Brett Gibbs said.
With biomass-based diesel production in a prolonged slump amid policy uncertainty that's gone on more than a year, it would be better for EPA to wait until 2027 to potentially impose the "half RIN" policy, according to Gibbs. There's already new tax policy that discourages foreign biofuel feedstocks, while raising crop benefits, and waiting would give fuelmakers more confidence in properly buying compliance credits that could help restore biofuel production, he said.
"If the EPA's sole goal is to get U.S. renewable diesel and biodiesel back up and running as soon as possible, it's of my belief that the 50% RIN isn’t in their best interest for 2026 at this point," Gibbs said.
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