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Biofuel Advocates Want To Loosen Rules For Farm Credit
By Mr Ethanol | November 12, 2007
Wallace’s Farmer:
A group of leaders involved in Iowa’s renewable fuels industry is calling for expansion of the Farm Credit System’s lending authority. They want a change in federal law so Farm Credit would be allowed to make loans to build ethanol and biodiesel plants that do not have a majority of farmer-stockholders as owners.
The group has sent a letter to both of Iowa’s U.S. Senators, Chuck Grassley and Tom Harkin, and to other senators. The letter asks them to support expansion of Farm Credit’s lending authority because of difficulties in expanding the renewable fuels industry and maintaining its profitability. An amendment has been proposed to add to the new farm bill being debated in Congress.
Trying to preserve farmer-ownership
“The current economic climate is challenging, to say the least,” says Sam Cogdill, president of Amaizing Energy LLC, an ethanol plant at Denison in western Iowa. He is one of eight people representing ethanol and biodiesel plants across the state who signed the letter.
“We understand the struggles of expanding the ethanol and biodiesel industry and trying to keep it profitable in changing economic times,” he adds. “Rising input costs and other factors are creating increasingly smaller margins for ethanol and biodiesel producers.”
Farm Credit has been making farm loans for over 90 years and understands the challenges of agriculture, the letter points out. Because of that experience, the system has the ability and capacity to structure loans that account for the variables in the renewable fuels industry.
More capital needed for bigger plants…
Topics: Agriculture, Biofuel, Money |
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