Ethanol Blog

LINCOLN, Neb. (DTN) -- Clean Fuels Alliance America asked the Trump administration's chief trade official to close a loophole in the reciprocal tariff regime that the group says is putting U.S. biofuels producers at a disadvantage.

In a letter to U.S. Trade Representative Jamieson Greer on Wednesday, the group asked the administration to close the loophole that the group says invites duty-free access to the U.S. for imported renewable diesel.

Clean Fuels said that loophole is putting U.S. biodiesel, renewable diesel and sustainable aviation fuel producers at a "competitive disadvantage" to overseas producers.

"Given the ongoing imports of foreign renewable diesel and current challenges for domestic producers and farmers, we ask that you take prompt action to close this loophole," the letter said.

"With billions of dollars invested in the last five years, U.S. biodiesel, renewable diesel, and SAF producers (collectively biomass-based diesel) have more than doubled capacity to reach the current potential to produce 6.7 billion gallons per year. In 2024, biomass-based diesel met 10% of U.S. demand for on-road distillate fuel -- a substantial part of America's energy dominance."

Clean Fuels said American producers have planned additional investments across the country to increase U.S. energy production and that the industry relies on a "steady supply" of a variety of renewable raw materials, such as vegetable oils, animal fats, and used cooking oil, as feedstocks to produce the fuels.

President Trump's Executive Order 14257, "Regulating Imports with a Reciprocal Tariff" imposed new tariffs on a wide range of imported goods, including the renewable feedstocks to which foreign producers have "unfettered" access.

"At the same time, the Executive Order's Annex II exempted from reciprocal tariffs imports of many energy products, including petroleum-based diesel classified under HTSUS subheading 2710.19.45 and renewable diesel,

which is classified under the same HTSUS subheading," the letter said.

"The end result is that foreign renewable diesel producers have access to tariff-free renewable feedstocks to produce renewable diesel and can then access the U.S. market without paying reciprocal tariffs. Since the start of this year, foreign renewable diesel producers have sent more

than 3.1 million barrels of renewable diesel -- primarily from Singapore -- to the United States. Unfortunately, much of the U.S. industry is idle or running significantly below capacity, due to policy uncertainty."

Clean Fuels said that since biomass-based diesel production supports 10% of the value of every bushel of soybeans grown in America, the situation is "adding to the pressures" on U.S. agriculture.

The reciprocal tariff order's lists of goods subject to tariffs and exemptions were modified in July and September, according to the letter.

"We ask that you support U.S. biomass-based diesel producers and farmers by again modifying the order and imposing consistent tariffs on imported renewable diesel," Clean Fuels said.

"Simultaneously, we ask that in trade negotiations you seek greater market access in global markets for U.S. biodiesel, renewable diesel, and SAF."

Todd Neeley can be reached at todd.neeley@dtn.com

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