The United States International Trade Commission voted on Friday to conduct an investigation into claims biodiesel imports from Argentina and Indonesia have hurt domestic producers, the ITC announced in a news release.
The allegations are the countries' subsidized biodiesel essentially nudged U.S. producers out of their home market.
Back in April the U.S. Department of Commerce estimated Argentina's dumping margin could be as high as nearly 27% and Indonesia's at about 28% from 2014-2016.
"The United States International Trade Commission today determined that there is a reasonable indication that a U.S. industry is materially injured by reason of imports of biodiesel from Argentina and Indonesia that are allegedly subsidized and sold in the United States at less than fair value," the ITC said in a news release.
Preliminary countervailing duty determinations are due on or about June 16, with preliminary antidumping duty determinations due on or about Aug. 30.
Ray Bradbury, president of risk management for Archer Daniels Midland's corn processing business and North America biodiesel, said in a statement on Friday the ITC is taking the right steps.
"As one of the petitioners on this important industry initiative, we are pleased to see that the ITC has taken the first step toward imposing countervailing and antidumping duties on biodiesel imported from Argentina and Indonesia," he said.
"The facts clearly show that Argentina and Indonesia are engaging in unfair trade practices, and we are confident that duties will be imposed when the final decision is made. This process exists to prevent export practices that injure workers in the importing countries--in this case, the United States. American farmers, American workers and American biodiesel can and should have a free and fair playing field."
The National Biodiesel Board said imports from Argentina and Indonesia increased by more than 460% from 2014 to 2016, gaining about 18% in U.S. market share during that time.
U.S. producers claim the two nations gained the market share illegally when the market expanded more than 58% in 2014-2016.
It isn't the first time Argentina and Indonesia have been challenged on their fuel export practices.
In May 2013, the European Commission announced provisional anti-dumping duties against the countries. Peru imposed both antidumping and countervailing duties on biodiesel from Argentina last year.
The U.S. industry also faces a federal policy headwind as the $1 biodiesel blenders tax credit expired at the end of 2016, and industry officials told the commerce department the credit may not be renewed in 2017. This means biodiesel producers essentially receive $1 less per gallon for their product.
Also on Friday, a bill introduced in the U.S. House of Representatives would re-instate the tax credit and change it to a producer's tax credit to cover 2017 to 2020.
The bill was introduced by Reps. Kristi Noem, R-S.D., and Bill Pascrell, D.-N.J., provides an additional 10-cent-per-gallon credit for small U.S. biodiesel producers. Companion legislation was recently introduced in the U.S. Senate by Sens. Charles Grassley, R-Iowa, and Maria Cantwell, D-Wash.
"We are thrilled to see momentum building in both chambers of Congress for this important tax reform," Anne Steckel, vice president of federal affairs for the National Biodiesel Board, said in a statement.
"It is long overdue to close this loophole and better align the incentive with Congress' intent—to invest American taxpayer dollars to spur job creation here at home."
Todd Neeley can be reached at email@example.com
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