US biodiesel imports on the rise

By Ron Kotrba | July 10, 2013

U.S. imports of biomass-based diesel spiked in March as the nation imported nearly 17.3 million gallons, up from only 2.2 million gallons in February, according to Energy Information Administration data. Roughly half of that came from Argentina (6.1 million gallons) and Indonesia (2.1 million gallons). The rest originated from Germany (5.5 million gallons) and Canada (3.3 million gallons). The U.S. also exported biodiesel to Germany and Canada in March. In addition to biomass-based diesel imports, the U.S. imported nearly 8.5 million gallons of “other renewable diesel” in March from Finland, Singapore and Canada. EIA defines “biomass-based diesel” as biodiesel or renewable diesel, and “other renewable diesel” as product coprocessed with petroleum.

“We’re clearly seeing some small volumes of imports starting to come in given market economics with the tax incentive,” says Anne Steckel, vice president of federal affairs for the National Biodiesel Board, “but we expect the vast majority of production will continue to be from domestic producers. We have always advocated that the biodiesel tax incentive be structured for producers instead of blenders, and we will continue to push for that change.”

Another source says the March spike in U.S. biodiesel imports is “only the beginning,” as the summer will bring about 21 million gallons of imports per month.  “Most of it is RIN-less and is in very strong demand because there are no RFS requirements risks associated,” the source says. “The economics of the tax credit make it viable like no tomorrow. This is very complex but rest assured that this, combined with [provisional tariffs from Europe] and the potential of a newly implemented traceability requirement for [used cooking oil] to Europe, will be a game changer. The U.S. is clearly not prepared for the maelstrom that will happen. I expect depression in feedstock prices. The soy boys will get a lesson in world economics.”

This spring the EU installed provisional tariffs on dumped biodiesel from Argentina and Indonesia (see Legal Perspectives on page 6). Reports indicated that Argentine producers were attempting to gain RFS2 registration with U.S. EPA to export biodiesel to the U.S. and generate RINs. The March volumes from Argentina were the first shipments of biodiesel to the U.S. since 2009. The biomass-based diesel from Indonesia was the first from there on EIA record.

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