Commerce Department Rules in Favor of U.S. Biodiesel Producers

Earlier this week, the U.S. Commerce Department announced that Argentina and Indonesia have been unfairly subsidizing biodiesel they export to the U.S. The Commerce Department found that Argentina and Indonesia provide subsidies to their biodiesel producers in violation of international trade rules. Additionally, the Commerce Department found “critical circumstances”, meaning retroactive duties will be enforced going back to May 2017.

As a result of the ruling, importers of Argentinian and Indonesian biodiesel will be forced to pay cash deposits on biodiesel imported from the two countries. The cash deposit rates range from 50.29 percent to 64.17 percent for biodiesel from Argentina, and 41.06 percent to 68.28 percent for biodiesel from Indonesia. The cash deposit requirements will be imposed when the preliminary determination is published in the Federal Register sometime next week. Also, based on the “critical circumstances” finding, the rates for Argentina will apply retroactively 90 days from the date of the Federal Register notice.

The investigation was in response to a complaint filed by the biodiesel industry in the U.S. The biodiesel industry representatives testified to the International Trade Commission a few months ago, saying biodiesel produced in Argentina and Indonesia has been flooding the U.S. market since 2014. The industry has claimed that the subsidized biodiesel from Argentina and Indonesia has forced U.S. producers out of their home market.

The Argentinian biodiesel industry claims that the duties will halt Argentinian biodiesel exports to the U.S. Argentinian biodiesel currently accounts for two-thirds of the U.S.’s biodiesel imports. PMAA is concerned that the duties on biodiesel will likely force fuel prices to rise because the U.S. must satisfy the biodiesel quota under the RFS and will have to find a way to replace nearly 250 million gallons of biodiesel per year.