D1 Oils urges EC action on US biofuels imports

01 April 2008 12:38  [Source: ICIS news]

By Mark Watts

 

LONDON (ICIS news)--UK-based biodiesels producer D1 Oils on Tuesday said it is confident the European Commission (EC) will address the issue of “splash and dash” imports from the US in the next 6-12 months.

 

“[EC action] is a very bureaucratic process but we are confident the issue will be addressed in due course,” said D1 Oils spokesman Graham Prince.

 

European producers are facing competition from biodiesel being shipped to the US, where a dash of fuel is added, allowing traders to claim an 11p ($0.22/€0.14) a litre subsidy for the entire cargo. It is then shipped back to Europe and undercuts domestic prices, hitting the continent's biofuels industry.

 

Producer group the European Biodiesel Board (EBB) is preparing a full report on the impact of the import of cheap US fuel on the EC and is expected to call on the commission to pursue an anti-dumping action against Washington.

 

D1 Oils was forced to stop its vegetable oil refining operations in the third quarter of 2007 due to the uncompetitive practice and has been using soya imports as an interim feedstock.

 

The company had bought the subsidised US B99 (99% biodiesel, 1% petrodiesel) to meet its customers’ demands and was considering halving its 70-strong workforce due to the effects of the import process, it said.

 

Although the B99 trade is not illegal, shipping fuel needlessly across the Atlantic contradicts the emissions-saving ideals of Europe’s push to produce green fuels.

 

Prince said new rules would require companies to provide information about the sourcing of biodiesel but that it would be difficult to acquire from smaller up-starts.

 

Up to 10% of biodiesel shipped to Europe from the US is thought to be part of the splash and dash trade. 

 

($1 = €0.63/$1 = ₤0.50)

 

For more on biofuels see Simon Robinson's Big Biofuels Blog

By: Mark Watts
+44 20 8652 3214

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