Back on January 12, 2016, the Ministry of Commerce of the People’s Republic of China (MOFCOM) filed antidumping and countervailing duty cases against the U.S. distiller’s dried grains industry (DDG). This was not the first time the MOFCOM has filed antidumping charges against the U.S.; however, all earlier cases were dropped.
Yesterday the ethanol industry including Growth Energy and the Renewable Fuels Association (RFA), called upon the U.S. government to take action against China on the current DDGs antidumping case. The groups sent a letter to President Obama calling for action through the Office of the U.S. Trade Representative, Department of Commerce and Department of Agriculture “to challenge both the process and preliminary determinations made by China’s investigating authority through comments to MOFCOM and through the World Trade Organization.”
The letter stated, “The uncertainty and market risk resulting from China’s actions has already triggered substantial financial losses for U.S. distiller’s grains producers. Distiller’s grains prices have plunged more than 25 percent since last summer, while prices for corn and other feedstuffs have been stable or even increased slightly. At a time when both U.S. ethanol producers and farmers are facing serious economic challenges, it is estimated that China’s actions have already resulted in distillers grains losing $30-35/ton in value. This is equivalent to an annualized aggregate loss of $1.2 to $1.6 billion to U.S. ethanol producers, many of whom are small businesses in rural America. Losses would mount further, potentially to $50-60/ton or more, if the anti-dumping and countervailing duty actions ultimately result in a total collapse of distillers grains exports to China, meaning a loss to the U.S. economy of more than $2 billion.”
The letter concluded by asking President Obama to “work closely with the U.S. distiller’s grains industry to mount an aggressive defense of our access to the Chinese livestock feed market throughout China’s antidumping and countervailing duty investigations.”