The European Biodiesel Board (EBB) is threatening legal action against American biodiesel subsidies, which they claim as an unfair trade practice.
Grainnet.com reports the Europeans are claiming the U.S.’s $1-a-gallon biodiesel mixture credit is artificially reducing the price of biodiesel sold in Europe by about 60-90 cents a gallon… compared to what European biodiesel goes for:
The EBB’s press release threatened action both before European antidumping authorities and before the World Trade Organization.
The U.S. biodiesel subsidies are set to expire at the end of 2008, but are quite likely to be extended.
Diesel fuel is used far more extensively for passenger cars in Europe than in the United States, and the European Union has a goal of 10 percent use of biofuels by 2020.
However, the EBB claims that the U.S. subsidies (which the EBB asserts are also taken advantage of by Asian biodiesel producers who transship through the United States) are shutting down European biodiesel production and making expansion of such production difficult.
The EBB says American biodiesel being imported to Europe went from 90,000 metric tons last year to 700,000 metric tons this year… despite the fact that the American soybean-based biodiesel is more difficult to get into the European Union.