US urged to slap duties on biodiesel from Argentina, Indonesia

Traffic pass by a sign displaying prices for Unleaded Petrol and Diesel outside a garage in Chester in north west England, in this March 21, 2017 photo. (AFP)

WASHINGTON: US biodiesel producers on Thursday asked the government to impose antidumping duties on imports of biodiesel from Argentina and Indonesia that it says have flooded the US market and violated trade agreements.
The move by the National Biodiesel Board (NBB) trade group comes after two years of tension between US and foreign producers over soaring imports that the group says have threatened the profitability of domestic 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,” NBB Chief Executive Officer Donnell Rehagen said in a statement.
The NBB filed its request with the US Department of Commerce and US International Trade Commission (ITC) on behalf of US biodiesel producers.
The Advanced Biofuels Association (ABA), a rival trade group, said the allegations of illegal dumping were untrue. The group includes Louis Dreyfus Co., which makes biodiesel in Argentina, and Wilmar International Ltd., a maker of biodiesel in Indonesia.
“The members of the ABA vehemently oppose this action and expect these petitions’ rejections,” Michael McAdams, president of the group, said in a statement.
The NBB has sought to stymie imports since the US Environmental Protection Agency (EPA) in 2015 allowed Argentine biodiesel imports to qualify for US tax credits as part of the Renewable Fuel Standard (RFS).
Total US imports rose to a record 916 million gallons (3.5 billion liters) in 2016, according to US government data published this week. Argentina represented about two-thirds of US foreign imports, followed by Indonesia and Canada.
Total US demand is 2 billion gallons for the fuel, made mostly from vegetable oils.
The NBB said biodiesel imports from Argentina and Indonesia rose 464 percent from 2014 to 2016 due to “illegal trade activities.”
The petition claims Argentine biodiesel is dumped at about 23 percent below market values and that Indonesian biodiesel is sold around 34 percent below. Dumping is aimed at gaining market share.
Should the Commerce Department agree with these claims, it would levy preliminary antidumping duties in these percentages on the imported products. Any duties would need to be upheld by the ITC and an affirmative decision would lock them in place for five years.
A NBB spokeswoman said the petition was in the works prior to the election of President Donald Trump, who has taken a protectionist stance on business practices.
Argentina’s biodiesel association Carbio rebuffed the dumping accusations, saying the NBB used a definition of dumping that had been rejected by the World Trade Organization (WTO).
Argentina’s Production Ministry, which includes the under-secretariat for international trade, noted that the request came from the private sector.
“It does not mean the government will apply the measure,” Gaston Sandler, a spokesman for the ministry said.
The US Department of Commerce and Argentina’s agriculture and foreign ministries did not respond to requests for comment.
Oke Nurwan, Indonesia’s director-general of foreign trade, said in Jakarta that the world’s top palm oil producer would “not be silent” on the matter, but would work with associations and businesses to address the issue.
“If the US government approves the recommendation, the Indonesian government will cooperate and provide data required to prove that the producers’ accusations are incorrect,” Nurwan said via a text message.
He said Indonesia had taken a similar approach with EU anti-dumping duties, which it is challenging via the WTO.