Indonesian biodiesel hit with up to 18pc duties

The European Commission yesterday imposed countervailing duties of eight per cent to 18 per cent on imports of subsidised biodiesel from Indonesia, saying the move is aimed at restoring a level playing field for European Union producers.

“The new import duties are imposed on a provisional basis and the investigation will continue with a possibility of imposing definitive measures by mid-December this year,” said the EU executive in a statement yesterday.

Last week Indonesia’s trade minister said he would recommend to an inter-ministerial team a 20-25 per cent tariff on EU dairy products in response to the EU targeting the country’s biodiesel, adding that he had asked dairy product importers to find sources of supply outside the 28-nation bloc.

The EU duties are another blow to Indonesian biodiesel producers after the bloc said in March that palm oil should be phased out of renewable transportation fuels due to the palm plantations’ contribution to deforestation.

The European Commission, which coordinates trade policies for the EU, launched an anti-subsidy investigation in December following a complaint by the European Biodiesel Board.

It said its investigation showed that Indonesian biodiesel producers benefit from grants, tax benefits and access to raw materials below market prices. The commission says “this inflicts a threat of economic damage to EU producers”.

The EU biodiesel market is worth €9 billion (RM42.21 billion) a year, with imports from Indonesia reaching €400 million, it said.