The government of Argentina will raise the export tax on biodiesel from 8% to 15% from 1 July, Reuters reported on 28 May.

This would make the export of soya-based biodiesel from Argentina into Europe more expensive, potentially cutting the arbitrage that has been open since the WTO ruled that the EU had to reduce its anti-dumping duties against Argentina in September 2017, according to Post Online Media.

With the price of soya-derived biodiesel (SME) in Argentina lower than biodiesel in Europe, much had been booked as a blendstock for FAME (Fatty Acid Methyl Ester) into Europe, with almost 1.2M tonnes booked since the initial reduction of antidumping duties.

The boost in the export tax would most likely curtail some of these imports, Post Online Media said.

The top exporter of biodiesel – with 1.65M tonnes exported in 2017 – had been hit by retaliatory tariffs recently, Reuters said.

Earlier in the year, the USA imposed anti-dumping duties of 60.44-276.65% on biodiesel imports from Argentina and Indonesia, in addition to already high anti-subsidy taxes.

The Argentine exporters’ association CIARA-CEC was also expecting the EU to impose new tariffs in September or October.

According to Argentine President Mauricio Macri, lowering the biodiesel export was meant to “continue fostering convergence” between biodiesel and soyabean oil export taxes.

Macri took office in 2015 on a business-friendly platform and had been lowering the soyabean export tax from 35% in 2015 or by half a percentage point every month for two years.

Reuters said the soyabean export tax was currently 27.5% while the tax on soyabean oil and soya meal exports was 25.5%.

However, Treasury Minister Nicolas Dujovne said last week that the country may stop lowering the soyabean export tax in order to cut the government’s financial deficit.

A crash in the value of the peso in May meant Macri was forced to ask the International Monetary Fund for a standby loan.