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EU imposes definitive duties on Argentine, Indonesian biodiesel

By Ron Kotrba | December 31, 2013

As of Nov. 27, the EU imposed definitive antidumping duties on imports of biodiesel from Argentina and Indonesia. The antidumping measures consist of an additional duty of on average 24.6 percent for Argentina and 18.9 percent for Indonesia. The measures are based on a decision taken by the council, following a 15-month investigation carried out by the European Commission, which concluded that Argentinean and Indonesian biodiesel producers were dumping their products on the EU market. The exports were claimed responsible for significant negative effects on the financial and operational performance of European producers.

“The EU is open to Argentinean and Indonesian exports but we should not stay idle and tolerate structural raw material distortions,” says John Clancy, EU Trade spokesman. “We’re glad the council adopted the commission proposal, which is based on an objective investigation in line with WTO (World Trade Organization) law. Now we can be reassured that our green energy sector is not under threat and will continue developing to the benefit of all Europeans.”

Argentina’s Foreign Ministry said it is seeking immediate action from the WTO under the Dispute Settlement Understanding, and at press time the formal complaint had been filed. The ministry says the duties were imposed “without a justified legal and factual basis,” and are “clearly protectionist in nature.” The duties “leave no option for Argentina than immediate action under the Dispute Settlement Understanding of the WTO, as soon as it is enforced, so as to ensure the production, foreign sales and jobs generated in our country for the sector,” the foreign ministry says. “Argentina is currently one of the most efficient biodiesel producers globally. The European industry, in contrast, is widely oversized, with companies that, in general, do not have quality ingredients, do not have adequate production scale and lack vertical integration necessary to be competitive globally.”

In 2011 and 2012 combined, Argentina exported 982.8 million gallons of biodiesel, half of which was exported to Spain alone, according to the USDA Foreign Agricultural Service. The European Biodiesel Board, which initiated the investigation, insists Argentina’s differential export taxes, which incentivize exportation of biodiesel versus raw soybean oil, allow for dumping at a cost lower than European producers can compete with. 

The European Commission says it took great care to ensure transparency of the process that culminated the decision. All interested organizations, including raw material providers, producers, importers and users, had an opportunity to express their views during the investigation to ensure that the overall benefits of such measures go beyond any potential inconvenience. Following the so-called “lesser duty” rule, the duty rates to be imposed will be lower than the dumping margin itself and will instead be pitched at a level calculated sufficient to offset the injury suffered by the industry. 

The definitive antidumping measures will apply for five years.

 

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