CLOVERDALE, INDIANA, U.S. — POET will idle production at its bioprocessing facility in Cloverdale, Indiana, U.S., due to recent decisions by the Trump administration regarding significant reduction exceptions (SREs). The process to pause the plant will take several weeks, after which the plant will cease processing of over 30 million bushels of corn annually and hundreds of local jobs will be impacted.

POET has reduced production at half of its biorefineries, with the largest drops taking place in Iowa and Ohio. As a result, numerous jobs will be consolidated across POET’s 28 biorefineries and corn processing will drop by an additional 100 million bushels across Iowa, Ohio, Michigan, Indiana, Minnesota, South Dakota and Missouri.

The 92 million gallon per year Cloverdale, Indiana, U.S., facility was acquired by POET in June 2010 and underwent $30 million in upgrades, including BPX, POET’s patent-pending fermentation process that uses enzymes instead of heat, reducing energy usage by 10% to 15%. The plant began operations on March 22, 2011.

The plant provides environmentally friendly fuel as well as a Dakota Gold brand livestock feed for regional, national and international markets.

Jeff Broin, chairman and chief executive officer of POET. Photo courtesy of POET.

“The Renewable Fuel Standard was designed to increase the use of clean, renewable biofuels and generate grain demand for farmers,” said Jeff Broin, chairman and chief executive officer. “Our industry invested billions of dollars based on the belief that oil could not restrict access to the market and EPA would stand behind the intent of the Renewable Fuel Standard. Unfortunately, the oil industry is manipulating the EPA and is now using the RFS (Renewable Fuel Standard Program) to destroy demand for biofuels, reducing the price of commodities and gutting rural economies in the process.”

The RFS authorizes small refinery exemptions for refiners that process less than 75,000 barrels of petroleum a day and demonstrate “disproportionate economic hardship.”

According to POET, over the past two years, the EPA has issued waivers to refineries owned by ExxonMobil, Chevron, and other large oil companies — “none of which are small and none of which have economic hardship.”

POET said the EPA’s mismanagement of SREs has created an artificial cap on domestic demand for ethanol and driven RIN values to near-zero, which weakens the incentive for retailers to offer higher blends. Oil is making billions of dollars, yet still using EPA to stop biofuels growth by handing out hardship waivers to some of the wealthiest companies in the world, in contradiction with President Donald Trump’s public comments.

POET said the EPA has cut biofuels demand by 4 billion gallons and reduced demand for corn by 1.4 billion bushels, causing severe damage in rural America.

“POET made strategic decisions to support President Trump’s goal of boosting the farm economy,” said Jeff Lautt, president and chief operating officer. “However, these goals are contradicted by bailouts to oil companies. The result is pain for Midwest farmers and the reduction of hundreds of jobs and hundreds of millions of dollars of economic activity across Indiana.”

On Aug. 9, the EPA approved 31 refinery exemptions and since 2018 it has granted 53 RFS waivers to large oil companies, totaling 2.61 billion gallons of ethanol of renewable fuel, the National Corn Growers Association (NCGA) noted.

Lynn Chrisp, president of the NCGA. Photo courtesy of NCGA.

“Waivers reduce demand for ethanol, lower the value of our crop and undermine the president’s support for America’s farmers,” said Lynn Chrisp, president of the NCGA. “Waivers benefit big oil at the expense of corn farmers who, between losing export markets abroad and ethanol markets at home, are losing patience. Mr. President, you proudly stand with farmers, but your EPA isn’t following through. You can step up for farmers today by reining in RFS waivers. Farmers expect the RFS to be kept whole by accounting for waived gallons and bringing more transparency to EPA’s secret process.

“Farmers are facing a sixth consecutive year of depressed income and commodity prices, with farm income for 2019 projected to be half of what it was in 2013. It’s time for this administration to act in the best interest of farmers.”

POET has similar concerns for the U.S. rural economy and farmers.

“My long-term fear isn’t for the biofuels industry, it’s for rural America,” Broin said. “POET can continue to produce ethanol with cheap grain, but we don’t want to lose our family farmers. The EPA has robbed rural America, and it’s time for farmers across the Heartland to fight for their future.”