NBB testifies on damage done by Indonesian biodiesel imports

The US National Biodiesel Board (NBB) has testified before Congress on the harm caused by biodiesel imports from Indonesia.

At a public hearing at the US Department of Commerce, held in response to executive order 13786 calling for an omnibus report on high trade deficits, NBB described the damage done by the increasing volumes of unfairly traded biodiesel imports. NBB suggests that the trade deficit with Indonesia, the highest ever, is partly due to the biodiesel imports.

The US trade deficit with Indonesia reached $13.2 billion (€11.8 billion) in 2016, a 20% increase over 2014.

“Between 2014 and 2016, the trade imbalance with respect to biodiesel has grown 95%,” testified Anne Steckel, vice president of federal affairs at NBB. “Unfair trade practices have caused this significant surge in biodiesel imports and growing trade deficit, such as massive subsidisation by the Indonesian government and dumped pricing by Indonesian biodiesel producers and exporters. These practices have injured—and threaten to continue injuring—U.S. biodiesel producers.”

NBB claims that the Indonesia government uses tactics such as high export taxes on exported crude palm oil, preferential financing from the Indonesian Export-Import Bank, and subsidies and tax incentives to allow its biodiesel producers to become dominant exporters and take an ever greater share of the US market. On the other hand, US producers do not have the same ability to export to Indonesia.

Struggling to compete with Indonesian prices, US biodiesel producers’ financial condition “has declined significantly” according to NBB. This has caused US producers to cut back on investments expanding production capacity at a time when the biofuels industry is growing.

Antidumping and countervailing duty petitions filled by NBB against both Indonesia and Argentina are intended to counter subsidised biodiesel from both countries. The Department of Commerce is currently investigating biodiesel imports before a decision in made on the petitions.