EU exempts eight Argentine biodiesel producers from duties

Eight Argentine biodiesel producers will be allowed to export to the EU without paying duties as long as they sell their product at a set minimum price, the EU Official Journal said on 12 February.

Reuters reported that Argentina and the EU agreed last month to put an end to their dispute over biodiesel exports from Argentina.

The European Commission (EC) found that Argentine producers had benefited from unfair subsidies but it would exempt companies from 25%-33.4% duties if they agreed to a minimum price scheme which was to take effect on 13 February, Reuters wrote.

The companies that had signed up to the agreement were Aceitera General Deheza, Bunge Argentina, LDC Argentina, Molinos Agro, Oleaginosa Moreno Hermanos, Vicentin, Cargill and COFCO International Argentina.

The EC began investigating Argentine and Indonesian biodiesel imports in 2012 after a request from EU producers of fuels made from vegetable and recycled oil.

The EU case was based on export duties both countries imposed on the raw material, soyabeans for Argentina and palm oil for Indonesia. The EU thought this gave unfair advantage to biodiesel producers in those countries, which allowed them to sell products at unfairly low prices.

The Commission imposed anti-dumping duties in 2013 but then had to remove most of them in March 2018 after successful challenges at the World Trade Organization and the European Court of Justice.

Reuters said the minimum price under the scheme would be linked with the average monthly soyabean price quotations published by Argentina’s agriculture ministry, which reflected the inclusion of export tax. The quotations were based on closing prices on the Chicago Board of Trade.

The European Biodiesel Board (EBB) said that under the agreement, Argentinean exporters would be allowed to export a maximum of around 1.2M tonnes/year of biodiesel to the EU every year without paying duties.

“In order to avoid peak exports, no more than 37% of this annual volume will be allowed to be traded in a single quarter.”

The EBB said it would closely monitor the correct implementation of the agreement and would promptly inform EU authorities of any unfair or untrustworthy practices linked to the execution of the agreement.

“In case the agreement will not be respected and the level playing field will not be restored in the coming months, EU authorities have the power to withdraw the agreement and simply apply the general ad valorem duty of around 30% to all Argentinian biodiesel exports towards the EU.”