Argentine biodiesel group seeks talks to resolve EU trade tension

20 January 2010 23:11  [Source: ICIS news]

HOUSTON (ICIS news)--An Argentine biodiesel group proposed an open dialogue with the European Biodiesel Board (EBB) to ease growing tensions between the country and its primary export market, it said on Wednesday.

The EBB alleged that Argentina has adopted a tax structure that encourages biodiesel exports.

The EBB said on 18 December that Argentina exports increased dramatically from less than 5,000 tonnes in July 2008 to almost 100,000 tonnes/month in July 2009, a twenty-fold increase.

“For the whole of 2009, Argentine exports are expected to overstep the 1m tonnes threshold, as compared to only 70,000 tonnes the previous year,” the EBB said in a statement.

The EBB blamed the surge on Argentina’s export tax system, “which creates an artificial incentive for the production and export of the finished product biodiesel rather than its raw material [soybean oil]”.

In a 13-page document to the EBB, the Argentine trade association said Argentina’s biodiesel industry would like to establish honest dialogue between the two groups that would allow for greater trade between the two regions.

The proposal addresses accusations made by the EBB, said Argentine Renewable Energies Chamber president Carlos St James, including year-on-year export number disagreements, lurking tax advantages and implied misconduct by Argentina with the US to circumvent Europe’s penalties on US biodiesel exports into the region.

The EBB said it was reviewing all possible legal and political options to address the issue and the alleged distortions caused by the Argentine export tax structure.

To date, Argentina has duty-free access to the European biodiesel market, but the EBB said the arrangement was vulnerable under present circumstances.

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