US ‘disappointed’ in EU’s proposed 9.5% ethanol duties

23 January 2013 23:39  [Source: ICIS news]

HOUSTON (ICIS)--The US Trade Representative’s office on Wednesday objected to a proposed EU import duty on US ethanol that EU officials say would offset subsidies given to US producers.

The European Commission (EC) is seeking anti-dumping duties of 9.5% on all ethanol coming from the US, according to a proposal seen this week by the Reuters news agency. A final judgment is not expected before the end of February, sources previously have told ICIS.

“We are evaluating the proposed Council Implementing Regulation. We are disappointed in this outcome,” a spokeswoman for the US Trade Representative’s office, Nkenge Harmon, said. “We have serious concerns about certain procedural and methodological aspects of the investigation.”

The Renewable Fuels Association (RFA) and Growth Energy, two US trade groups, condemned the proposal in a joint statement.

“America’s producers and marketers of ethanol are outraged by the news that the European Commission has proposed to the European Council an anti-dumping duty equivalent to €62.3 per tonne [$83.1/tonne] on all ethanol produced in the United States, regardless of who produces the product or who sells it,” the organisations said. “This decision is unprecedented. Not only does it fly in the face of over 30 years of consistent practice by the EC, but it also violates numerous provisions of the World Trade Organization’s Agreement on Antidumping.”

“We are exploring every option to overturn this decision,” said Tom Buis, CEO of Growth Energy. “Our producers and trading companies cooperated fully with the Commission’s requests for information. In the end, it was all ignored in favour of what can only be described as a political decision to erect an artificial trade barrier.”

In December, sources expressed concern to ICIS about the possible duties, saying US material has not been subject to a subsidy since the end of 2011.

“It’s a trade war on the US,” one source said. “Ethanol and corn are very important for the US. The whole investigation is bogus and has been carried out on fragile ground.”

The US is the world’s largest ethanol exporter, for whom the European market has been a key export destination.

The introduction of penalties on US product could be encouraging news for European ethanol producers. Also, the opportunities to bring product from the US to Europe would become limited, and sources expect that the European market would import fuel ethanol from Brazil.

($1 = €0.75)

By: Jeremy Pafford
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