U.S. corn, soybean and sorghum producers did not receive expected tax breaks for aviation fuel production, online publication The Western Producer reported March 4.
U.S. Agriculture Secretary Tom Vilsack told producers at the 2024 Commodity Classic that the government needs more time to figure things out. The minister promised to inform farmers about the decision in the coming weeks and not delay it for months.
“I am now confident that the GREET model will form part of the guidance being developed by the Treasury.”Vilsack said. GREET is an acronym for Argonne National Laboratory’s Greenhouse Gas, Regulatory Emissions and Energy Use Life Cycle Model for estimating greenhouse gas emissions. The model was developed by order of the United States Department of Energy.
American corn producers are pleased that the GREET model is the basis for receiving the tax benefits outlined in the US emissions reduction law.
The European International Civil Aviation Organization (ICAO) offers a different calculation model. “Corn will never fit that model. That’s why we support the GREET model.””said Harold Volle, president of the National Corn Growers Association.
The cost of emission is very high, since the SAF tax credit is 1.25 dollars (115 rubles) per gallon of biofuel (SAF) or 30.38 rubles per liter. The US government has set a goal of increasing biofuel production to three billion gallons (793 million liters) by 2030, from 10 million gallons (2,642 million liters) today.
Corn ethanol sells in the US for $1.50 (135 rubles) per gallon (35.67 rubles per liter), while gasoline costs $3 (275 rubles) per gallon (72.65 rubles per liter). Ethanol itself is a very competitive fuel.
The main rumor revolves around the use of soybean oil for fuel production. Soy-based diesel fuel is much more expensive than regular diesel. Soy fuel is totally dependent on tax incentives.
Volle noted that it takes between 1.6 and 1.7 gallons of ethanol to produce one gallon of jet fuel, so the three billion gallon limit is even higher than it seems. “We need to use more corn.”Vilsack stated to explain why the Government is in no hurry to make a decision.
Source: Rossa Primavera
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