Some major news outlets such as Reuters have reported that, as a result of the antidumping investigation the European Commission is conducting regarding biodiesel imports from Indonesia and Argentina, provisional tariffs have been established at zero to 10 percent, and 7 to 11 percent, respectively.

Biodiesel Magazine could not confirm this, as the case handling team for this EC trade defense case told me this morning that “Currently, no measures have been imposed on imports of biodiesel from Argentina and Indonesia. The deadline for the imposition of provisional antidumping measures, if any, is May 28.”

Shortly after Reuters reported this, the news outlet published a story indicating that Argentine biodiesel producers are undergoing the RFS2 registration process with U.S. EPA in order to export biodiesel to the U.S. and generate RINs to help satisfy the U.S. federal mandate. The article quotes Luis Zubizarreta, president of the Argentine Biofuels Chamber, as saying he expects to gain this approval in the next couple of months.

“We are obviously monitoring the situation and looking at the impact any change could have on the industry,” Ben Evans, director of public affairs and federal communications at the National Biodiesel Board, tells me. “This is a difficult process to complete, and we’re not aware of anything at EPA that’s pending at this time.”

Other sources tell me they believe Argentina is nowhere near as close as they suggest to proving to EPA that they can qualify their feedstock for RFS. “I believe they have a long way to go before they can prove no land use changes, if they can at all,” one source says. “It's sort of like the palm guys trying to qualify. They have a long road to go.”

But what if they do gain registration, whether it’s two months from now, or next year?

The U.S. is no stranger to the situation Argentina is facing with the EU. In 2009, the European Commission imposed tariffs on U.S. biodiesel imports into Europe. In 2008, much of the 700 million gallons of U.S. biodiesel produced was exported to Europe. This was well before RFS2 was implemented; that didn’t come until mid 2010, after the industry was near collapse following the first lapse of the $1 per gallon credit, imposed tariffs from the EU and the severely delayed implementation of RFS2. What brought the industry back? It wasn’t finding new export outlets to dump its product though—it was a strong domestic mandate. Currently, Argentina requires 7 percent biodiesel content in its diesel fuel. It has been suggested the nation will move to 10 percent. On a percentage basis compared to U.S. biodiesel consumption, it’s pretty clear Argentina already has a strong domestic mandate.

So the question becomes, would the influx of nearly a half a billion gallons of Argentine biodiesel into the U.S. market decimate the U.S. biodiesel industry, or would it help fulfill shortfalls in the undifferentiated advanced biofuel pool?

Early this year we heard all about, and reported on, how U.S. biodiesel, subsidized with the $1 per gallon credit, would be an economically attractive option for obligated parties to fulfill their undifferentiated advanced biofuel targets compared to Brazilian sugarcane ethanol. The production numbers for U.S. biodiesel in the first quarter, however, do not indicate this to be the case—yet. Just less than 259 million gallons of U.S. biodiesel, as reported by EPA, was produced first quarter. Annualized, this would equate to slightly more than 1 billion gallons, not even enough to fulfill the biomass-based diesel carve-out in the advanced biofuel pool.

Of course, the U.S. is already receiving biodiesel and renewable diesel imports from Canada, Australia, Singapore and other nations. Combined, in January and February alone, Canada exported 2.73 million gallons of biodiesel to the U.S., according to EIA data. In January, Australia exported 714,000 gallons of biodiesel to the U.S. Also in January, Canada exported 336,000 gallons of “other renewable diesel” to the U.S., according to EIA data. In February, 9.9 million gallons of “other renewable diesel” was exported from Singapore, Portugal, Finland and Canada into the U.S., a vast majority of which (6.76 million gallons) was from Singapore.

Regarding advanced biofuels and RFS2, EPA yesterday proposed to amend certain elements of the RFS2 in order to facilitate the introduction of new renewable fuels and improve implementation of the program, the agency stated. “The proposal includes various new renewable fuel pathways that will enhance the ability of the biofuels industry to supply advanced biofuels, including cellulosic biofuels, to the market,” said EPA. It is proposing to allow renewable diesel, renewable naphtha, and renewable electricity (used in electric vehicles) produced from landfill biogas to generate cellulosic or advanced biofuel RINs. Renewable compressed natural gas (CNG)/liquefied natural gas (LNG) produced from landfill biogas are also proposed to generate cellulosic RINs. EPA is also proposing to allow butanol that meets the 50 percent GHG emission reduction threshold to qualify as advanced biofuel. The rulemaking also proposes a clarification regarding the definition of crop residue to include corn kernel fiber and proposes an approach to determining the volume of cellulosic RINs produced from various cellulosic feedstocks. Clearly these measures are being undertaken by EPA to broaden the availability of fuels that qualify for the advanced biofuel bucket.

What do you think? Will Argentine biodiesel producers be able to prove their soybeans and biodiesel do not cause land use changes and be successful in gaining EPA registration? If so, what impacts would such an enormous amount of imported product have on the U.S. industry, and how would U.S. producers adapt? As we have seen time and time again, the U.S. biodiesel industry is remarkably resilient and adaptive. Would this, however, be insurmountable compared to the challenges faced and overcome in the past? I’d like to hear your thoughts on the matter. Please provide your comments below. I very much look forward to hearing from you.