Biodiesel imports in Peru are expected to drop by 67% this year to 50M litres, according to a report by the United States Department of Agriculture (USDA).

The fall in imports followed the country’s temporary suspension of its biodiesel mandate from 11 March until 9 September this year due to alleged supply chain interruptions, the USDA’s 5 December Foreign Agricultural Service (FAS) Biofuels Annual said.

Biodiesel imports in the country are controlled by renewed anti-dumping and countervailing duties on US biodiesel and more recently introduced countervailing duties on Argentine biodiesel.

Argentina had requested consultations with Peru at the World Trade Organization (WTO) on 2 September regarding countervailing duties on biodiesel imports, the report said, claiming that such measures could run against provisions of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 and the Agreement on Subsidies and Countervailing Measures. This meeting was reportedly pending.

Biodiesel consumption in Peru slowed after the target blend rate was achieved in 2012, the Global Agricultural Information Network (GAIN) report said, and since then further increases were dependent on a growing diesel market.

“Despite diesel price increases and based on continuing economic growth, diesel consumption is forecast to increase slightly while the blend rate falls according to temporary policy change, but the policy did help to buoy fuel demand,” the report said.

Following a halt in biodiesel production from 2014-2016, the country resumed production in 2017.

Peru produced 208M litres of biodiesel in 2021 – an increase of 12% compared to the previous year – but biodiesel use remained low, the report said.

In 2022, biodiesel production in Peru was forecast at 208M litres.