24 August 2012

US ethanol imports under scrutiny by the EU

New regulation of the European Commission to ensure the EU ethanol industry

The European Commission has today published its decision to proceed to the registration of ethanol imports coming from the USA by issuing a new regulation (n°771/2012)1. The decision comes in response to a request within an anti‐subsidy case filed by the European Renewable Ethanol Association (ePURE) in November last year.

“This decision represents an important step forward for the European ethanol industry and acknowledges the significant damage caused to European ethanol producers by massive quantities of subsidised ethanol imported from the USA”, said Mr. Rob Vierhout, Secretary General of ePURE.

Through this Regulation, the European Commission has officially acknowledged the damage caused to the EU industry by a significant increase of imports of ethanol from the USA both “in absolute terms and in terms of market share”, and the negative impact that these imports have had on ethanol prices in the EU market and for EU ethanol producers. As a result, EU ethanol production has been badly affected, leading to a critical financial situation within some EU ethanol producers, culminating in the temporary shut down of several ethanol plants.

The decision to proceed to the registration of imports will not affect the decision by the European Commission not to apply provisional measures as a result of the removal of the VEETC biofuels subsidy scheme in the USA in late 2011. But by allowing for strict monitoring of imports from this country, this regulation will discourage the USA from reinstating the VEETC scheme retroactively and it will entitle the EU to adopt provisional countervailing duties if the US scheme is reinstated.

Source: ePURE, press release, 2012-08-24.

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