The European Commission announced on Friday (July 19) documents showing that Chinese biodiesel, also known as bio-diesel, is being sold at unfairly low prices in the EU market. As a result, the EU has declared that temporary anti-dumping tariffs of up to 36.4% will be imposed on this product. This is the latest in a series of trade dispute incidents between the EU and China.
According to the non-governmental organization Transport and Environment (T&E), which advocates for clean transport and energy in Europe, over the past two years, the European biofuels market has been flooded with used cooking oil imported from China, leading to a drastic drop in market prices from around 2,250 euros per ton to 1,100 euros. A recent study by T&E indicated that China’s acquisition costs are 30% lower than those in Europe.
The European Commission proposed in documents released on Friday to set temporary tariffs on Chinese biodiesel between 12.8% and 36.4%, to be implemented in mid-August.
The EU’s investigation into Chinese biodiesel is expected to conclude in February next year, at which point the EU may impose a final tariff on the product for a period of five years.
This latest move by the EU undoubtedly exacerbates the already tense trade relationship between the EU and China. The EU has already imposed additional anti-subsidy tariffs ranging from 17.4% to 38.1% on electric cars produced in China.
Regarding biodiesel, the EU plans to impose a 12.8% tariff on products from the EcoCeres Group, a 36.4% tariff on products from the Jiaao Group, including Zhejiang Jiaao Environmental Protection Co., and a 25.4% tariff on exports from Longyan Zhuoyue New Energy Co.
The European Biodiesel Board (EBB), which filed the complaint, stated earlier this month that the large influx of biodiesel from China has had a destructive impact on EU production. Chevron Renewable Energy Group has forced German workers to take temporary leave; Shell has halted construction at a plant in the Netherlands; BP has stopped a project in Germany; and Argent Energy has closed a biodiesel refinery.
“While imports from China are not the sole reason for these decisions, the dumping of biodiesel has exacerbated the difficulties faced by producers,” EBB said.
In 2023, Chinese companies exported 1.8 million tons of biodiesel to the EU, accounting for 90% of China’s total biodiesel exports.
The European Waste and Advanced Biofuels Association welcomed the EU’s new measures, stating that it believes these actions will help restore market conditions from being “extremely unfavorable” since the end of 2022.