Johnson County farmers have expressed general disapproval of policy exemptions for facilities that turn crops into fuel across the state. Iowa Attorney General Brenna Bird urged an investigation into these facilities across the state. 

Bird sent a letter to federal agencies alleging some of Iowa’s small biofuel refineries may be cutting production to qualify for ethanol exemptions, a tactic that farmers say is contributing to lower prices and lost income on their crops.

The Renewable Fuel Standard, or RFS, is a federal program requiring U.S. fuel suppliers to mix renewable fuels into gasoline and diesel with the Environmental Protection Agency, or EPA, with the 2025 target calling for renewable fuels to account for about 13 percent of the nation’s gasoline and diesel supply.

Small refineries — those unable to satisfy the 75,000-barrel-per-day threshold — can claim an exemption from this requirement by submitting an application that is then reviewed by the EPA.

According to the letter, which was sent on Oct. 29, these companies are claiming hardship while simultaneously telling investors they’re thriving.

According to the U.S. Energy Information Administration, Iowa produces over one-fourth of the nation’s ethanol, making Iowa particularly exposed to these kinds of exemptions. When small refineries bypass mixing requirements, it cuts directly into the demand for fuels.

George Swenka, a farmer and rancher in the Tiffin area, agreed with Bird and said he was unhappy with these exemptions, adding it does not make sense to avoid the 10 percent when it helps “everyone.”

“It gives them [refineries with exemptions] an unfair advantage in the marketplace,” Swenka said.” It’s a renewable resource. It helps the producers. It helps every state that’s involved. At the end of the day I just don’t think it’s achieving the goal that should be a common goal for all of us.”

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Chad Hart, an agriculture and finance economics professor at Iowa State University, said this lack of demand has caused financial hardship for farmers.

“It’s a combination of them having ample supplies right now and not seeing as much demand as they would need to take prices higher again. So, if you have the sort of overwhelming supply combined with demand uncertainty, they’re feeling financially squeezed,” Hart said.

Swenka spoke personally about how the lack of demand has affected his farming and said it is especially difficult as farming prices continue to rise.

“Right now, the prices that we’re receiving are just at breakeven, and without an extra marketplace without another source to market our goods, it really makes it tough,” Swenka said.

He said the issue is a common conversation for farmers, calling it “coffee talk,” but he also worries that refinery issues will not be taken as seriously.

“Farmers make up less than 1 percent of the population, so we really feel sometimes that we’re a minority and we feel that we lack any kind of political clout,” he said. 

However, he hopes those outside of agriculture realize it affects the broader Iowa community.

“There’s such a high percentage of jobs, especially in Iowa, directly or indirectly touched by agriculture. So, when the attorney general does good, we all do good, especially in small rural Iowa,” Swenka said.

Great American Insurance Group’s Iowa’s 2025 Digital Yield Tour projects Iowa’s 2025 corn yield could hit 223.7 bushels per acre, which would be well above recent averages, with the average last year being 205 bushels per acre. Hart cited statistics like these as a potential reason why Bird decided to write to the federal government, as many farmers are looking for “usage of their bountiful harvest.”

Hart said the last time Trump was in office, a large number of exemptions were granted to these smaller refineries, and then later overturned in court cases, with Trump issuing 85 exemptions in his first term according to an EPA report.

“There’s also this idea that we may see a similar wave of that here during President Trump’s second term,” Hart said.

Timothy Hagle, a political science professor at the UI, said if changes aren’t made, people may see farms go out of business. According to a Bloomberg Law report released in April, farm bankruptcies grew 55 percent from 2023 to 2024 and are trending even higher in 2025, with Iowa leading all other states with 12 bankruptcies. 

“You’re going to have some farmers that would not be able to continue because of financial reasons, so they may go out of business. You may have some people that would switch crops to the extent they can do,” Hagle said.