Europe fuel market examines prospect of importing 50% ethanol blends

13 June 2013 10:26  [Source: ICIS news]

LONDON (ICIS)--A number of European fuel ethanol market participants have been examining the possibility of importing ethanol blends of 50% gasoline, according to a source late on Wednesday.

In March 2012, the European Commission introduced a regulation whereby blends of up to 70% ethanol and 30% gasoline were reclassified as denatured ethanol, instead of being classified as a chemical.

Denatured ethanol is subject to a standard import duty of €102/cbm ($136/cbm), whereas product classed as a chemical is subject to a tax of 6.5% ad valorem.

The 50% ethanol/50% gasoline blends can therefore be classified as a chemical, avoiding the more expensive duty charged for denatured ethanol.

However, if the ethanol in the blend has come from the US, an anti-dumping duty of €62.90/cbm will still be applicable, according to the source.

“If the ethanol is of American origin, it still attracts the countervailing duty,” the source said.

This means that market participants interested in importing such blends will need to import fuel ethanol from a country other than the US, and blend it with gasoline in a country outside of the EU in order to be competitive, the source added.

There was outcry from the European renewable ethanol industry body, ePURE, in May 2013 following reports that blends of 92% ethanol and 8% gasoline originating in the US were arriving in Finland.

ePURE called upon the European Commission to fully investigate whether EU customs legislation was being properly being applied in the country.

($1 = €0.75)

By: Sarah Trinder
+44 20 8652 3214

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