U.S. Agriculture Secretary seeks to calm farmers after Trump biofuel talks

NEW YORK (Reuters) - U.S. Agriculture Secretary Sonny Perdue told an agriculture conference on Wednesday that he and President Donald Trump support the country’s biofuels policy, and that any reports to the contrary are “fake news.”

FILE PHOTO: U.S. Secretary of Agriculture Sonny Perdue speaks at an event to celebrate the re-introduction of American beef imports to China, in Beijing, China June 30, 2017. REUTERS/Mark Schiefelbein/Pool

Perdue made the comments a day after Trump hosted a meeting with Cabinet officials and senators to discuss potential changes to the Renewable Fuel Standard to help refiners who say they are struggling under the program. The RFS requires refiners to blend biofuels like corn-based ethanol into the nation’s fuel.

That meeting yielded no deal.

“I can tell you Trump stands with corn farmers, biofuel farmers and the RFS,” Perdue told an audience at the Commodity Classic in Anaheim, California, according to a recording heard by Reuters. “I stand with him and with you.”

He said media reports that the administration does not support the RFS are “fake news.” “I will not support any policy that diminishes demand, undermines the RFS or is harmful to agricultural producers,” Perdue said.

A spokesman for the U.S. Department of Agriculture confirmed that Perdue made the comments.

Trump’s meeting on Tuesday reflected rising concern in the White House over the current state of the RFS, which has increasingly divided two of Trump’s most important constituencies: the energy industry and rural farmers.

A refining company in Pennsylvania, a state that often plays a key role deciding the outcome in national elections, last month blamed the regulation for its bankruptcy. This bolstered charges by the industry that the RFS is unfair and costly.

The White House meeting was held at the request of Republican Senator Ted Cruz of Texas and was intended to get Chuck Grassley and Joni Ernst, both Republican senators from the corn state Iowa, to accept significant changes to the program aimed at providing financial relief to refiners.

The senators said on Tuesday they were asked to support placing price caps at the center of the program in exchange for greater use of higher-ethanol blended gasoline. The administration was also considering allowing exported ethanol to qualify for credits under the program, the senators said.

The senators said the proposals would gut the program and attempt to solve a problem - high costs for refiners - that does not exist.

Perdue offered a different perceptive of the meeting, describing it more as a listening session than a negotiation.

“He listened to both sides and told senators Grassley and Ernst that he will be strong for farmers and maintain the RFS,” Grassley said.

The White House is expected to hold another meeting on Thursday with merchant refiners and biofuel groups, though a full list of participants was not immediately known.

Reporting by Jarrett Renshaw; editing by Frances Kerry and Chizu Nomiyama