Ethanol on China’s Draft Retaliation List

Cindy Zimmerman

Following action by President Trump yesterday to impose tariffs on up to $60 billion in Chinese imports, China is making its list of what U.S. products will be the target of retaliation. The list reportedly includes agricultural products such as U.S. pork, modified ethanol, wine, fruits and nuts, and soybeans are expected to be as well.

“We’re disappointed that China is seeking additional tariffs on U.S. ethanol exports,” said Growth Energy CEO Emily Skor said. “These actions could undercut our potential to increase exports to China following the country’s stated goal to move to a 10 percent ethanol blend by 2020, and would be a major barrier to increased trade.”

Renewable Fuels Association President and CEO Bob Dinneen says they expected ethanol would be on the list. “China’s response was entirely predictable, given recent actions by our administration to implement new tariffs. It is my fervent hope that the White House now fully understands the impact these actions will have on America’s ethanol industry and farmers, and we urge the administration to redouble its efforts to expand demand for ethanol here at home.”

China was the third-largest market for U.S. ethanol exports in 2016, accounting for almost 20% of total exports, but Dinneen says the country imposed a 30% tariff on U.S. ethanol last year, bringing sales down to almost nothing until recently when they have started to tick back up despite the tariff. “But a 15% additional tariff, on top of the 30 percent that’s already there will clearly prohibit any sales to that country,” Dinneen says.

Audio file – RFA CEO Bob Dinneen reacts to potential China retaliation tariffs

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