Cash-short U.S. biofuel industry cuts lobbying even as Iowa looms large in election

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By Stephanie Kelly

NEW YORK (Reuters) – A top U.S. biofuel industry trade group said it has cut lobbying spending as the coronavirus pandemic has slammed members eager to press demands with President Donald Trump, who hopes to win the corn-producing state Iowa in November.

Reduced clout could complicate the industry’s efforts to secure changes to U.S. biofuel policy that producers say would shore up demand for corn-based ethanol, but which face strong opposition from oil refiners.

“This is a critical time,” said one biofuels source, who wished to remain anonymous to speak candidly. “The list of things before us is long and people are hemorrhaging money, so you’ve got to do a lot more with less.”

A Des Moines Register/Mediacom Iowa Poll this summer showed Iowa, the top ethanol-producing state, appears to be a toss-up between Trump and the presumptive Democratic nominee Joe Biden.

The Renewable Fuels Association spent $339,676 toward lobbying efforts during the second quarter, according to a U.S. Senate database that tracks lobbying disclosures. That was down 12% from the same time last year and 4% from the prior quarter. The group told Reuters it has cut outside consultants while also reducing advertising spending.

“Our resources are more limited today because of COVID-19 and the impact on the industry,” RFA President Geoff Cooper told Reuters. Around 150 biofuel plants of the nation’s approximately 200 facilities either idled or reduced production after the health crisis struck and drastically reduced global demand for fuel.

Biofuels producers and farmers that supply them with raw materials are a major constituency that Trump needs in his reelection bid. Some were hoping to leverage political support in an election year to get demands met.

The industry wants the administration to grant fewer waivers exempting small oil refineries from requirements that they blend biofuels into their gasoline under the U.S. Renewable Fuel Standard (RFS).

The Trump administration has sharply increased the number of such waivers granted to refiners, upsetting biofuel producers. The refining industry says small refiners need the waivers to stay in business.

Oil refiners also took major revenue hits during the pandemic and have also cut their lobbying budget. The American Fuel and Petrochemical Manufacturers trade association reported spending $567,144 on lobbying for the second quarter, down more than 30% from a year ago, the Senate’s database showed.

An AFPM spokeswoman said the drop had nothing to do with coronavirus or refining industry economics. Instead, she said last year’s expenditures were high because of work the group did around a policy for cleaner marine fuel.

(Reporting by Stephanie Kelly; Editing by David Gregorio)

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