Allowing E15 to be sold year round fails to address structural problems plaguing many Nebraska farmers’ bottom lines, but it’s an important step nonetheless.
This announcement fails to remove tariffs that have hindered the ability of producers to sell overseas, enact meaningful property tax reform or reverse the damage caused by historic flooding. It can’t be a silver bullet for those things, of course.
But what it can do is help increase commodity prices for Nebraska-grown corn – which have been in the basement for years – by increasing demand and helping spur additional investment in the state’s rising ethanol industry.
President Donald Trump visited an ethanol plant just across the Missouri River in Iowa on Tuesday, touting his administration’s role in expanding E15 sales from nine months to 12. It followed up a similar trip to Council Bluffs last October, in which the president announced his intent to pursue the rule change made final earlier this month.
"Farmers not only promote prosperity," he told the crowd, but also protect national security by reducing America's dependence on foreign oil – another argument for expanded ethanol.
When it comes to agriculture, Trump has largely kept his promises. Sometimes, that follow-through has hurt farmers, as it has with market uncertainty resulting from tariffs. But his actions on ethanol should further drive up corn prices, which have recently rallied following natural disasters that inundated fields and likely depressed supply this year.
One crop isn’t the be-all and end-all, of course, but the ag economy powers Nebraska – and corn plays a leading role in that. The state ranks second in production of ethanol and third in corn. Both help to power this state’s economy and will continue to do so for the foreseeable future.
Despite the economic impact of agriculture and ethanol in the Cornhusker State, E15 can be surprisingly hard to come by. The Nebraska Ethanol Board lists fewer than 60 gas stations statewide with flex fuel pumps that accommodate this fuel. Just two are located in Lincoln.
E15 and higher blends of ethanol are less expensive than typical gasoline for consumers, too, costing a few cents per gallon less than the widely available 10% blend. In Nebraska, that fuel is often as much as 30 cents per gallon cheaper than gas without any ethanol.
In addition to the obvious boost it will provide farmers and commodity prices, year-round expansion on E15 sales should also encourage the investment in infrastructure to deliver ethanol blends. Provide customers options at the pump, and let them make the choices they deem best.
Again, E15 sales aren’t a panacea for all that ails the ag industry. But good news means a welcome departure from the doom and gloom that’s dogged farmers in recent months and years. In that respect, the purpose behind president’s stop couldn’t have come at a better time.