In Trump Freeze, U.S. Agencies Delay Rules Affecting Farm Towns

Source: By Chris Prentice in New York and Tom Polansek in Chicago, Reuters • Posted: Wednesday, January 25, 2017

NEW YORK/CHICAGO — U.S. regulators under the new presidential administration have instituted a freeze on rules key to the country’s farm belt, agricultural groups said on Tuesday, heightening uncertainty for some of the regions that helped propel Donald Trump into office.

The Environmental Protection Agency (EPA) will delay implementation of this year’s biofuels requirements along with 29 other regulations finalized in the last weeks of Barack Obama’s presidency, according to a government notice. The U.S. Department of Agriculture will pause rules affecting livestock, groups said.

EPA and USDA representatives did not respond to requests for comment.

The freeze prompted worry in rural communities on Tuesday, though sources said such delays are not unheard of with a new administration. Trump won nearly two-thirds of the rural vote in November, with big agricultural states lining up for the Republican.

The more than decade-old Renewable Fuel Standard (RFS) has been stymied by regulatory delays in years past and is facing uncertainty under the new administration, including a proposed EPA chief who has been a critic of the program.

The RFS, which is aimed at reducing greenhouse gas emissions and reliance on imported oil, requires that oil companies blend increasing amounts of biofuels, such as corn-based ethanol, into gasoline and diesel. Refiners that fail to do so must buy paper credits.

Some in the oil industry were heartened by the news. The oil industry has lobbied heavily for changes or a repeal of the policy.

“While the regulatory freeze implemented by President Trump does not change the statutory compliance of the RFS, it does provide an opportunity to take a closer look at this fundamentally flawed policy,” said Chet Thompson, president of the American Fuel and Petrochemical Manufacturers, which represents companies including oil refiners.

Prices of the paper credits used by fuel companies to prove they are meeting the requirements dropped sharply after the news, falling to the lowest levels since November 2015.

The Renewable Fuels Association, which represents biofuels producers, said it did not expect the procedural delay to lead to any significant changes to the requirements. The delayed fuel rules will be implemented on March 21, according to a federal register notice.

About a third of the 13.6 billion bushels of corn produced in the United States in 2015 was used to make fuel ethanol, according to the National Corn Growers Association.

At the USDA, “they put a regulatory freeze on everything that is in the pipeline,” said Dave Warner, spokesman for the National Pork Producers Council.

The agency has put on hold new rules it had formerly said would help protect meat producers from mistreatment by packing companies and processors, he said. The pork council opposes the measures, saying they are not necessary.

The freeze is also affecting new rules that would for the first time mandate specific space requirements for hens laying organic eggs, Warner said.

The U.S. Cattlemen’s Association said the delay in implementing USDA rules involving meat packers was worrisome. The group, which represents cattle producers, had supported the measures as needed to prevent anti-competitive buying practices.

It was not immediately clear when or if the USDA rules would be implemented.

“We are certainly on edge right now and hope that with further review the Trump administration will see the value in those rules,” said Lia Biondo, the association’s policy and outreach coordinator.

(Reporting by Chris Prentice in New York and Tom Polansek in Chicago; Editing by Andrew Hay and Leslie Adler)