Joco Today

U.S. Senator Roger Marshall, M.D., has spearheaded a bipartisan letter urging the U.S. Treasury Department to limit the eligibility of the 45Z Tax Credit to renewable fuels derived exclusively from domestically-sourced feedstocks, such as Kansas soybean oil and corn oil. The tax credit, effective January 1, is criticized for potentially incentivizing foreign used cooking oil over local soybean and corn oil.

The letter highlights concerns that federal authorities fail to verify the legitimacy of imported used cooking oil, with much believed to be fraudulent. Since August 2023, imports of used cooking oil from countries like China have averaged over half a billion pounds per month, exerting downward pressure on American soybean and corn prices. This price drop has reportedly resulted in at least $5.4 billion in lost production value for American farmers.

Senator Sherrod Brown (D-OH) co-led the letter with Senator Marshall, joined by Senators Jerry Moran (R-KS), Eric Schmitt (R-MO), Mike Braun (R-IN), Todd Young (R-IN), Dick Durbin (D-IL), Tammy Duckworth (D-IL), Deb Fischer (R-NE), Pete Ricketts (R-NE), Tammy Baldwin (D-WI), Debbie Stabenow (D-MI), Joni Ernst (R-IA), Tina Smith (D-MN), Gary Peters (D-MI) and Amy Klobuchar (D-MN).

J.D. Hanna, President of the Kansas Corn Growers Association, stated: "In meetings with the airline industry, we have heard firsthand their interest in using sustainable aviation fuels... But our own government regulators won’t allow U.S. ethanol to be used."

Kaleb Little, CEO of the Kansas Soybean Association, emphasized: "The biodiesel and renewable diesel industry has been a critical market driver for soybean profitability... Prioritizing domestic feedstock sources in the 45Z should be an easy decision."

Kailee Tkacz Buller, President and CEO of NOPA, added: "We firmly support free trade and open markets but cannot stand by and let foreign feedstocks benefit to the detriment of U.S. crushers."

Suzanne Shirbroun, President of the Iowa Soybean Association noted: "Growing imports of foreign feedstock such as used cooking oil... directly impacts soybean oil prices."

Josh Gackle from North Dakota's American Soybean Association remarked: “Our work to develop a thriving domestic bioeconomy is under threat from increased imports of foreign feedstocks.”

The letter asserts that it is vital for American energy independence and rural prosperity that guidance for Clean Fuel Production Credit 45Z is issued promptly before its January 1 deadline. It stresses restricting eligibility to domestically sourced renewable fuels to support domestic biofuels manufacturing while lowering carbon intensity.

"We urge you to issue proposed and subsequently final guidance for 45Z in advance of January 1," concluded the Senators.

For more details on Senator Marshall’s full letter click HERE.

###