Grassley: Biodiesel Extension Could Come in Late January

Production could come to halt beginning in January because of Senate inaction.

Democratic leadership did not move forward on the biodiesel tax extension before it expires at the end of the year.

Sen. Chuck Grassley, (R.-Iowa), said Democrats tried tying it to the estate tax, but Republicans wouldn't sign on to a non-controversial provision such as the biodiesel tax extension with the estate tax which would take some debate.

Grassley projected that with the inaction, "the U.S. biodiesel industry will likely grind to a halt January 1," he said in a conference call with reporters Dec. 22.

Sen. Max Baucus, (D-Mont.) and Grassley sent a letter to Senate leaders that this issue will be addressed as soon as possible in January.

The biodiesel provision could be retroactively fixed after the Senate returns. Grassley said the optimum time would be between January 19th and the Friday before the Senate starts its President's Day recess providing a three to four week timeframe.

But is that soon enough to help biodiesel? Grassley said, "It depends upon the forbearance of lenders and the cash flow, because there's not going to be any cash flow when you shut down, and they can't operate without the subsidy."

 

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