US biodiesel industry testifies to ITC on alleged illegal trading at hearing
The US Commerce Department has announced that it is formally initiating antidumping and countervailing duty investigations of biodiesel imports from Argentina and Indonesia following a petition that was filed March 23 with the Department and the US International Trade Commission on behalf of the National Biodiesel Board Fair Trade Coalition, which is made up of the National Biodiesel Board (NBB) and US biodiesel producers.
The US Commerce Department announced April 13 that it is formally initiating antidumping and countervailing duty investigations of biodiesel imports from Argentina and Indonesia.
The decision follows a petition that was filed March 23 with the US Department of Commerce and the US International Trade Commission on behalf of the National Biodiesel Board Fair Trade Coalition, which is made up of the National Biodiesel Board (NBB), a US trade association representing biodiesel and renewable diesel industries and US biodiesel producers.
– Initiation of these investigations validates the allegations in our petition, and we look forward to working with the US government agencies during the course of the next year to enforce America’s trade laws, said Anne Steckel, NBB Vice President of Federal Affairs in response to this announcement.
Testimony to ITC
Also on April 13, NBB and US biodiesel producers attended a hearing providing testimony to the International Trade Commission, explaining that Argentine and Indonesian companies are violating trade laws by “flooding” the US market with “dumped and subsidized” biodiesel, and how those imports are injuring American manufacturers and workers.
– Make no mistake, 2016 should have been a banner year for US biodiesel producers with demand growth, stable feedstock prices, and regulatory certainty that should have led to profitability and reinvestment in their businesses, but unfortunately, that didn’t happen,Instead, dumped and subsidized biodiesel from Argentina and Indonesia entered the United States in record volumes, capturing greater market share at the expense of US producers. The loss of market share has left the domestic industry with substantial unused capacity and the artificially low prices these imports are sold and leave American biodiesel unable to get a fair return for their product, said Steckel.
According to NBB, biodiesel imports from Argentina and Indonesia surged by 464 percent from 2014 to 2016 because of “illegal” trade activities. That growth has taken 18.3 percentage points of market share from US manufacturers.
– Negative margins within our industry due to low-priced imports have had a major impact on our company, with a disproportionately greater impact on smaller producers. We have halted several plant modification projects as a result of reduced working capital, even for modest projects. Because of this, Newport Biodiesel is being limited in its ability to be a productive US green energy company in what is otherwise a growing market, said Robert Morton, co-founder of Newport Biodiesel, a small biodiesel producer from Rhode Island at the hearing.
The adverse impact of dumped and subsidized imports is not limited to America’s small biodiesel producers.
– When we see biodiesel from Argentina selling at a discount to the market price of soyoil, the main input into biodiesel, we know we are facing dumped pricing. The US is a key market for these exporters, and without a remedy, these unfairly traded imports are likely to continue unabated. That is a further threat to our business, said Paul Soanes, CEO and President of Renewable Biofuels (RBF).
According to the Commerce Department’s notice of initiation, there is evidence that dumping margins could be as high as 26.54 percent for Argentina and 28.11 percent for Indonesia. Commerce’s notice of initiation also undertakes to investigate subsidies based on numerous government programs in those countries.
The Commission is expected to make its preliminary decision and vote on May 5, 2017. Following that, the next key step will be when the US Department of Commerce announces its preliminary determinations regarding the estimated rates of subsidization and dumping — expected on or about August 22, 2017 and October 20, 2017, respectively.