US biodiesel industry association National Biodiesel Board (NBB) has filed an anti-dumping and countervailing petition with the US Department of Commerce and International Trade Commission against Argentine and Indonesian biodiesel imports.
Submitted on behalf of the National Biodiesel Board Fair Trade Coalition, comprising NBB and US biodiesel producers, the complaint claimed that companies from Argentina and Indonesia were violating trade laws by flooding the US market with “dumped and subsidised” biodiesel.
Donnell Rehagen, CEO at NBB (pictured), said the board was committed to fair trade and supported the right of producers and workers to compete on a level playing field, but called the concerned imports “illegal” and “unfair”.
“This is a simple case where companies in Argentina and Indonesia are getting advantages that cheat US trade laws and are counter to fair competition. NBB is involved because US biodiesel production, which currently supports more than 50,000 American jobs, is being put at risk by unfair market practices,” Rehagen said in a statement dated 23 March.
According to NBB, biodiesel imports from Argentina and Indonesia had surged by 464% from 2014 to 2016 due to “illegal trade activities”, which had sucked 18.3 percentage points of the market share from US producers.
“The resulting imbalance caused by unfair trade practices is suffocating US biodiesel producers. Our goal is to create a level playing field to give markets, consumers and retailers access to the benefits of true and fair competition,” said Rehagen.
The NBB claimed that producers from both exporting countries were dumping their biodiesel in the USA by selling at prices “substantially below” their costs of production, which was reflected in the petition’s alleged dumping margins of 23.3% for Argentina and 34% for Indonesia.
The petition also alleged illegal subsidies based on numerous government programmes in both countries.
Argentine biofuels industry lashed out against the petition, with local industry chambers claiming that the country’s biodiesel exports could be “devastated” if anti-dumping duties were imposed against it, reported Reuters on 31 March.
“If a sanction is applied against Argentina in the US, our exports will no longer be viable. At this point, there is no alternative market,” Claudio Molina, executive director of the Argentina Biofuels Association, told Reuters.
According to Reuters, there was not enough demand to absorb excess production should US exports become blocked, as Argentina exported 90% of the 1.6M tonnes on biodiesel it produced in 2016.
Argentina taxed biodiesel at a variable rate, but the country’s producers paid significantly less for soya oil than their US counterparts, as they do not have to pay import taxes.
Europe used to be Argentina’s leading export client, but the relationship came to an end when the EU imposed anti-dumping duties on the country in 2013.
The World Trade Organization ruled in favour of Argentina’s complaint against the duties in 2016, but a counterclaim by the EU has kept them in effect for the time being.