EU slaps antidumping, antisubsidy duties on US biodiesel

The European Biodiesel Board (EBB), representing the major biofuels producing industry in the European Union, praised the European Council for approving what it called “definitive antidumping and countervailing measures against unfair US biodiesel exports.”

Jul 13th, 2009

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, July 13 -- The European Biodiesel Board (EBB), representing the major biofuels producing industry in the European Union, praised the European Council for approving what it called “definitive antidumping and countervailing measures against unfair US biodiesel exports.”

The group, which launched two legal complaints against US imports in early 2008, said the ministers’ decision “confirms that the US claims were misleading and self-defeating.” The group said, “They could not break the strong causality link between unfair US biodiesel trade and the damage suffered here in Europe.”

EBB Sec. Gen. Raffaello Garofalo said, “It is our greatest satisfaction to see the positive conclusion of a process initiated by EBB more than 2 years ago, involving considerable time and resources, for the defense of our endangered industry.”

The EBB statement came after the EU, saying it had to protect European producers from unfair American subsidies and below-cost selling, extended temporary import fees on US biodiesel.

The EU's 27 nations issued a joint statement, saying they would extend the temporary fees imposed in March for 5 more years beginning on July 12—a decision that will affect biodiesel sold to Europe by Archer Daniels Midland Co., Cargill Inc., and several other US firms.

In announcing the temporary measures last March, Lutz Guellner, EU spokesperson for trade, said, “After a thorough investigation based on the facts in this case, the commission has today decided to apply temporary duties on imports of US biodiesel.”

Guellner said the decision was taken on “the basis of clear evidence that unfair subsidization and dumping of US biodiesel has taken place, and that this is harming otherwise competitive EU industry, with potentially dire long term effects.”

Guellner said the temporary measures would come into effect from Mar. 13 and would remain in place for 4 months while the investigation and contacts with stakeholders continued.

“The level of the measures, which are applied together, is set at between €211.20-237/tonne for the antisubsidy duties and between €23.60-208.20/tonne for the antidumping measures,” Guellner said.

The EU decision followed a trade investigation that said US producers sold biodiesel to Europe at a price far below the real cost of production, while also receiving federal tax credits and state subsidies.

According to EBB, “For more than 2 years, US biodiesel has been sold in the European market at a substantial discount, at an even lower price than the vegetable oil raw materials purchased by the EU industry for producing biodiesel.”

As a result of such discounts, underwritten by the unfair state subsidies and federal tax credits, Guellner said that US exporters were able to increase their share of the EU biodiesel market to 17% from April 2007 to March 2008. The sharp rise was in marked contrast to US market share in 2005, which stood at 0.4%.

“By imposing dissuasive measures the EU is paving the way for a fair and sustainable EU biodiesel market, allowing operators to reap the benefits of their sustained investments in biodiesel production,” the EBB said, adding that it is “confident that the definitive EU measures will contribute to re-establishing the level-playing field EU producers have long hoped for.”

Still, the EBB said it will remain particularly vigilant regarding “any possible circumvention attempt, and is already liaising with EU authorities to track and report any shipment of US biodiesel that would fraudulently enter the EC market directly or indirectly via third countries.”

Contact Eric Watkins at hippalus@yahoo.com.

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