The issue: Low crop prices have farmers looking for solutions.
Local impact: Increasing the biodiesel standard could lead to a rise in soybean prices.
In 2005, Minnesota implemented the first biodiesel fuel standard when it required that 2 percent of all diesel include biofuel. Four years later, the state moved to a requirement of a 5 percent biodiesel blend, and in 2014 a 10 percent standard was implemented during the months from April through October.
Now Minnesota is moving to a 20 percent (B20) biodiesel blend.
Starting in 2018, all diesel in Minnesota will include the B20 blend.
The announcement was made this past Thursday afternoon at Farmfest.
Dave Frederickson, Minnesota Department of Agriculture commissioner, officially made the announcement on behalf of Gov. Mark Dayton in the Minnesota Soybean Growers Association tent, with Mike Petefish, Minnesota Soybean Growers Association president, also in attendance for the announcement.
“Implementing the B20 mandate is the culminating step in Minnesota’s commitment to biodiesel and renewable fuels,” said Frederickson. “Since 2005, we’ve been the leader in growing the biodiesel industry nationwide, and is has resulted in added value to our agricultural sector.”
According to the U.S. Soybean Board, the “farm economy has been in a holding pattern for years now and managing for the future is more important than ever.”
As a result, research continues to be conducted through the use of soybean checkoff funds to increase the oil content in soybeans.
In total, U.S. soybean farmers planted 650,000 acres of premium soybeans this year. Research has continued to show that biodiesel works as a cleaner burning, renewable alternative to traditional petroleum diesel, and use of biodiesel is on the rise. U.S. consumers used nearly 2.9 billion gallons of biodiesel and renewable diesel in 2016, which was a 40 percent increase over the previous year.
Domestic demand for biodiesel accounts for more than 25 percent of all soybean oil use in the United States.
According to the American Lung Association, the use of biodiesel significantly reduces emissions, and the use of B20 in Minnesota is expected to reduce the amount of particulate emissions by 130 tons and the amount of carbon dioxide by 1 million tons each year.
“Increasing biofuels will help protect and preserve Minnesota’s air and water quality for generations to come, reduce our reliance on fossil fuels, all while supporting Minnesota farmers,” said John Linc Stine, Minnesota Pollution Control Agency commissioner.
According Petefish, biodiesel currently adds 63 cents to every bushel of soybeans.
Frederickson is hopeful that the value per bushel will increase when the state goes to B20.
“B20 will help keep Minnesota at the forefront of the clean energy revolution that is expanding opportunities for the state’s farmers and rural communities,” said Mike Rothman, Minnesota Department of Commerce commissioner.
There are currently three biodiesel plants in Minnesota, including Albert Lea, Brewster and Isanti. Together, these plants produce 74 million gallons of biodiesel annually.
“This is a really exciting time for agriculture and all Minnesotans,” said Petefish. “It’s a win-win.”
Some organizations, including the Minnesota Truckers Association have expressed concerns about the decision and whether or not facilities will be ready to provide B20 when it is needed.
During the announcement, Frederickson stated he believes the state will be ready.
The B20 standard is only in effect during the warmer months of the year. During the November through March time frame the diesel will be blended with B5.
“Minnesota has been and continues to be a renewable fuels leader,” said Frederickson, adding the biodiesel industry continues to improve air quality, support the economy and add value to agriculture through research and innovation.