I am a member of the American Carbon Alliance consisting of a broad group of farmers, commodity organizations, biofuel and carbon industry representatives with the same agenda. Primarily that is to support the ag economy and stakeholders in it.

At the last meeting, John Gareston, John Deere’s director of renewable fuels and corporate strategy spoke to the group. It sounded like Deere had an epiphany that if farmers do not make money, they cannot sell them equipment. Farmers have always been a core customer base of Deere, and the company was seeing the writing on the wall telling them things, like our lack of profitability, that were alarming to them.

They understand that our productivity exceeds demand and, to be profitable, that needs to change. No one wants to undermine our productivity or depend on government largesse. He said that Deere was going to be open to some things that they may have passed on before and was going to get more involved in the promotion and planning behind growing future commodity demand.

If farm incomes are dependent on government ACHs, then their bottom line is too. There are some things that they can directly help contribute to biofuel demand. Their new type 4 engine uses B-30. They have a prototype of a tractor with an ethanol engine being field tested. In a nutshell, John Deere is focusing on growing commodity demand.

Welcome to the club.

The three components of corn demand are livestock, exports and biofuel. I do not see great growth coming from either domestic or export demand for meats. We export parts of animals that have little/no value to U.S. consumers. Grain/soy exports in general have been shrinking and are the most undependable component of our demand.

The demand sector with the most potential to grow corn demand is in the biofuel sector. This is something which is there waiting only for the go-ahead from Congress and the Trump administration. It will require their cooperation.

Credits used to incentivize low carbon ethanol, which is the best single prospect for demand growth, would be needed to get the industry going just as they were used for the ethanol industry. Once built, the low carbon fuel market will take it from there. The global demand for ethanol is for low carbon ethanol. The SAF demand hinges on low carbon ethanol. Currently the only ethanol that qualifies is Brazilian. That doesn’t have to be.

The 45Z carbon component of the Big Beautiful Bill Act (BBBA) was inadequate to incentivize the transition to low carbon ethanol. The statute enacted limited the carbon credit to too few years and the credit itself was too small. Opponents know that they do not have to eliminate 45Z to make it unusable. They frankly succeeded in the BBBA in handicapping 45Z with rules that undermine its useability. The following chart tells the story of who benefits from a functional 45Z and what the realistic prospects would be in boosting net farm income.

I am not aware of anything else that can have the ability to add enough value to the farm economy to cover our demand shortfall other than low-carbon ethanol. It is there and waiting, when and where there is the cognizance to reach out and take it.

Unfortunately, farmers have to get behind a consensus before politicians will even try. One would think that after seeing the benefits the ethanol industry brought to the ag economy, this would not be that tough of a sale. Then again, there are some farmers that are good with just getting aid ACHs. Others hope to buy the neighbor’s farm if he goes broke. The ethanol industry was a tough sale at the time of its development and this one will be no easier. Things like eminent domain get in the way. Farmers who are passing lucrative offers for voluntary easements at risk from eminent domain, are the very reason that eminent domain was adopted. CO2 carbon capture is a component of producing low carbon ethanol.

Delays in development of CO2 pipelines will have caused an unrecoverable loss of opportunity that would have gotten the ethanol industry much closer to producing low-carbon ethanol than we are today. Farmers who oppose value-added demand best not complain about poor margins as they are part of the problem. I did my part and wished that others would do theirs.

Please forgive me … after a few decades of seeing this lack of vision you get a little cranky.

Knowing what needs to be done, even if clear as glass, is one thing, while bringing the change together is another. It can be done, as was the case with the existing ethanol industry. Who would have dreamt that such a demand component such as the biofuel industry could have become what it is today. Our productivity is an asset not a liability. Our demand problem is fixable. It is within our domestic ability to grow our own demand to match our productivity.

Folks now vote on the basis of ideology rather than performance. It is probably not wise to insult them for their failure in getting us policy that we need, but what are they going to do? Not deliver for us anymore? Seems like that’s already the reality. Go to DC and lobby the legislators and they will pledge allegiance to our cause … but then nothing happens. They could be called many things, but “policy-makers” is not one of them.

When Elon Musk could kill year-around nationwide E-15 because he had some convoluted reasoning that it was contrary to his interest harming demand for Tesla electric vehicles, we have a problem. He killed our demand for corn to benefit the interest in demand for his EVs and our elected officials let him get away with it. I do not imagine Elon would favor low carbon ethanol either. By the way, President Trump did not protect farmers from Musk. Like I said … I am cranky.