By Lauren M. Graham, Ph.D.
On August 15, 2017, the U.S. Department of Commerce’s (DOC) International Trade Administration (ITA) announced in the Federal Register that the preliminary determination in the antidumping (AD) and countervailing duty (CVD) investigations on biodiesel from Argentina and Indonesia will be postponed. A request to postpone the determinations was submitted by a petitioner on July 6, 2017, and, pursuant to Section 733(c)(1)(A) of the Tariff Act of 1930, ITA determined that there was no compelling reason to deny the request. The preliminary determination will now be due by October 19, 2017, and the final determination will be due within 75 days of the issuance of the preliminary determination.
ITCA previously postponed the determinations following a May 22, 2017, request from a petitioner, as reported in the Biobased and Renewable Products Advocacy Group (BRAG®) blog post DOC Postpones Preliminary Determinations for Biodiesel AD/CVD Investigation.
By Lauren M. Graham, Ph.D.
On April 13, 2017, the U.S. Department of Commerce (DOC) announced that it was formally initiating antidumping (AD) and countervailing duty (CVD) investigations of biodiesel imports from Argentina and Indonesia. The decision follows a petition filed by the National Biodiesel Board Fair Trade Coalition, as reported in the Biobased and Renewable Products Advocacy Group (BRAG®) blog post “National Biodiesel Board Fair Trade Coalition Files Antidumping, Countervailing Duty Petition.” The National Biodiesel Board and U.S. biodiesel producers also provided testimony to the International Trade Commission (ITC) on April 13, 2017, explaining that Argentine and Indonesian companies are violating trade laws by flooding the U.S. market with dumped and subsidized biodiesel, and how those imports are injuring American manufacturers and workers.
The investigation covers biodiesel in pure form, mixtures containing at least 99 percent biodiesel by volume, and the biodiesel component of mixtures containing less than 99 percent biodiesel. ITC will issue its preliminary injury determinations by May 8, 2017. If ITC determines that imports of biodiesel from Argentina and/or Indonesia materially injure or threaten material injury to the domestic industry, the investigation will continue and DOC will announce its preliminary CVD and AD determinations in the summer of 2017.
By Kathleen M. Roberts
On March 23, 2017, the National Biodiesel Board (NBB) announced that an antidumping and countervailing duty petition had been filed with the U.S. Department of Commerce (DOC) and the U.S. International Trade Commission (ITC) claiming that Argentine and Indonesian companies are violating trade laws by saturating the U.S. market with dumped and subsidized biodiesel. The petition was filed on behalf of the National Biodiesel Board Fair Trade Coalition, which represents the NBB and U.S. biodiesel producers. According to NBB, Argentine and Indonesian producers are selling their biodiesel in the U.S. at prices that are substantially lower than their costs of production, and government programs in both countries are providing illegal subsidies to their domestic biodiesel industries. Between 2014 and 2016, biodiesel imports from Argentina and Indonesia increased by 464 percent, which resulted in an 18 percent loss in market share for U.S. manufacturers. Both countries have previously been charged with violating international trade laws. Following NBB’s announcement, Senator Maria Cantwell (D-WA) released a statement urging DOC and ITC to give the suit every appropriate consideration and pledging to continue to work across the aisle to reform the biodiesel tax credit, so that it incentivizes the domestic production of clean, renewable biodiesel.
On April 8, 2016, Reuters reported that Argentina is planning on increasing the required percentage of ethanol in gasoline from 12 percent to 26 percent. Specific targets have not yet been created for increasing the required ethanol blend, but Argentina has been increasing the required ethanol percentage to reduce energy deficits and boost its economy. Argentina first created an ethanol mandate at five percent in 2010, and has increased the percentage incrementally since then. The increase of 14 percent, from 12 percent to 26 percent, is expected to result in $400 million in investments, and is also expected to streamline automaker operations, as many cars are produced for both the Argentinian and Brazilian markets.
On January 27, 2015, the U.S.
Environmental Protection Agency (EPA) approved the importation of biodiesel
made from soybeans from Argentinian biofuel producers as qualifying for U.S.
biofuel credits under the federal Renewable Fuel Standard (RFS).
Argentina's Biofuels Chamber's (CARBIO) request for an "Alternative
Renewable Biomass Tracking Requirement" was approved, which allows foreign
manufacturers to be part of the RFS if they follow certain environmental
standards. The U.S. biodiesel industry has criticized this pathway approval for
Argentinian biodiesel because it is believed to be less rigorous than other
certification standards used previously. Before this pathway was approved,
individual Argentinian biofuel producers could still qualify for the RFS
program on their own, but the new method through CARBIO will allow all
interested companies to be tracked as a consortium. EPA does not expect the
approval to result in competition with domestic biofuel producers. This claim
is strongly disputed by U.S. agricultural and biofuel groups. The Argentinian
biodiesel industry has a production capacity of well over 1 billion gallons,
which could displace a large percentage of the RFS volume requirement of 1.28
billion gallons, which to date has been made up primarily of U.S. product.
The National Biodiesel Board and others have sought the views of
the EPA Administrator and have asked EPA to revisit this pathway decision. If
EPA does not change its position, the organizations may consider legal options.
In addition, there is currently a group of about 30 U.S. Senators who have
called for EPA to reverse the rule.