Farm and biofuel groups urge Trump to limit expanded refinery exemptions

• The administration is considering increasing small refinery exemptions from about 950 million credits to as many as 1.8 billion for the 2025 compliance year, with a decision expected by end of August
• Iowa Republican Senator Joni Ernst called the plan a 'handout to Big Oil,' arguing SREs would hurt farmers and pad refiner profits without actually lowering gas prices for consumers
• Renewable fuel credit (RIN) prices have already fallen as traders anticipate weaker biofuel demand, with groups warning excess exemptions could collapse biofuel markets and reduce demand for American crops

Summary: Farm and Biofuel Groups Oppose Trump Administration's Refinery Exemption Expansion

A coalition of U.S. farm and biofuel organizations is urging President Trump to reject a proposed expansion of small refinery exemptions (SREs) from federal biofuel blending requirements, warning the move would severely damage rural America and biofuel demand.

Key Details:

• The administration is considering nearly doubling exemptions from approximately 950 million credits to as much as 1.8 billion credits for the 2025 compliance year
• A decision is expected before the end of August
• The expansion is driven by efforts to reduce gasoline prices that have risen during the war with Iran, potentially helping Republicans in November's midterm elections

Market Impact:

• Renewable fuel credit (RIN) prices have already declined as traders anticipate weaker biofuel demand
• Groups warn excess exemptions could "decimate the demand signal" established by EPA's March 2026-2027 renewable volume obligations rule
• Potential consequences include biofuel market collapse, reduced corn and soybean oil demand, and weakened rural economies

Industry Stakeholders:

• Opposition: Renewable Fuels Association, Growth Energy, National Farmers Union advocate limiting exemptions
• Political Opposition: Iowa Senator Joni Ernst (R) calls the plan a "handout to Big Oil," arguing it won't lower gas prices but will hurt farmers while benefiting refiners making record profits

Background:

The Renewable Fuel Standard (RFS) requires refiners to blend specified renewable fuel amounts into U.S. fuel supplies or purchase RINs for compliance. Small refineries can receive exemptions by demonstrating disproportionate economic hardship, effectively removing exempted gallons from the market.