Source: POLITICO'S MORNING AGRICULTURE, 10/16/19

The EPA on Tuesday outlined its proposed rule to reallocate biofuel blending requirements for the next two years — and some ag producers aren't happy with how it turned out.

The new rule fills in the details of a deal announced earlier this month, which was intended to help offset the lost demand due to federal waivers for small oil refiners, which Trump's EPA has handed out with far more frequency than previous administrations. But the agency said it will use a three-year average to calculate the lost demand based on the number of gallons the Energy Department had recommended exempting, rather than a larger number of gallons that are actually waived.

That could translate to a significantly smaller boost to biofuel demand. According to the National Farmers Union, "The former would have increased the amount of biofuels in the transportation sector by approximately 1.35 billion gallons per year, while the latter will increase it by just 770 million gallons."

Farm groups on Tuesday framed the new proposal as a major letdown compared with what they were expecting, and it doesn't live up to the "giant package" of changes Trump had promised in August. Monte Shaw, CEO of the Iowa Renewable Fuels Association, said the rule "reneges on the core principal of the deal." The NFU called it "another broken promise to American farmers," while the National Corn Growers Association said the plan "appears to come up short again."

Quotes so nice they used them twice: Our Pro Energy friends point out that some of the quotes used in Tuesday's EPA press release were recycled from two weeks ago, when the agency announced the outlines of the deal. The problem? Not everyone feels the same way now after seeing the details.

— Sen. Chuck Grassley (R-Iowa), who is quoted as saying the proposed rule is "great news," had a more tempered reaction on Tuesday: "President Trump brokered this deal and any attempt to undermine it from EPA would represent a betrayal of the president," he said in a statement. "I expect EPA would not do that after all the work that's gone into this issue."

— Ethanol trade group Growth Energy is quoted as calling EPA's rule "a victory for rural America." But the group sent out a very different statement on Tuesday describing the proposal as "unconscionable," and a Growth spokesperson said the "inclusion of an outdated quote ... is very misleading."

— EPA spokesperson Michael Abboud explained the quote reuse by saying, "[Tuesday's] announcement is the proposed text from our announced agreement on October 4th."

What's next: The EPA will gather public comments until Nov. 29 and is required to issue a final rule by Nov. 30.